4 October 2011

Nigeria: Church of Scotland Inspired Current Islamic Banking -IFC

An Islamic Finance Council (IFC) Executive Board member in the United Kingdom (UK), Omar Shaikh, has disclosed that the Church of Scotland actually inspired the current Islamic Banking system.

Speaking while presenting a paper titled, "Development of Islamic finance in the UK:Sharing experiences with the Central Bank of Nigeria" the IFC Executive Board member said that the person who set up the first contemporary Islamic Bank in Egyp,was inspired by the Rev Henry Duncan founded Trustee Savings Bank (TSB).

"200 years ago, there was an amazing person called Rev Henry Duncan. He founded Trustee Savings Bank otherwise called the savings bank movement. So the Savings Bank movement which was everywhere in the World across Europe, South America, Africa was inspired 200 years ago by a Reverend from the Church.

"He realized that in Scotland and all the places that poor people could not save, Banks will not provide services for poor people, be it financing or saving and he set up a structure known today as saving movement.

"When the first Islamic Bank in contemporary times in the 19 century in Egypt was to be established, the guy who set that up actually went across the Europe, Denmark or so and he saw the saving bank structure and he was inspired by that and he took that structure to set up what is now been the founding institution for Islamic Banking," he said.

He said that the UK has successfully built out Islamic finance within a secular framework, adding that the there is "no special favour, no obstacle" to the operations of Islamic banking in the country.

"The tax implications for some of the structures will trigger double tax and that is an obstacle in Islamic banking but they have removed that obstacle to make the equal treatment with the conventional banking. It's a principle stand that was taken in the UK and we have been successfully doing that," he said.

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