Nairobi — Standard Chartered Bank sees great potential for Islamic banking in Kenya with only two percent penetration to the total banking business.
Standard Chartered Bank's Global Head of Islamic Banking Wasim Saif says with the population of Muslims being 10 percent in the country Islamic banking could grow to a double digit number in the next five years.
He was speaking on Tuesday in Nairobi, as he launched the bank's Islamic banking offering under the brand name Saadiq.
Saadiq which means truthful becomes the first market of Standard Chartered's African footprint for Islamic banking.
The new window will offer Shariah compliant products that include personal banking, home financing, as well as business and corporate banking.
"This will provide a platform for us to enter in other African markets that include Tanzania, Uganda, and Nigeria in two to three years," Saif stated.
Saif says Africa is the next frontier for the Islamic banking sector and will become a significant part of the financial institutions in the country with global Islamic finance market investments worth $ 1.7 trillion.
He says Islamic banking is not only for Muslims but also attracts clientele of all faiths and beliefs.
"It is banking with values, its core principles of trust, equity and fairness in dealings are shared equally by people of all faith, and we have seen adoption of Islamic banking by non Muslims in other parts of our market that include Malaysia, China and the United Kingdom," Saif noted.
Oh his part, the bank's Chief Executive Officer Lamin Manjang says Islamic banking is growing rapidly in Kenya as more commercial banks open their doors to Islam banking products in bid to satisfy a growing demand in the market.
Manjang says the new offering comes as a response to the increased demand from the banks customers.
"We see the entry of Saadiq and the additional Islamic banking products and services we will offer which are Shariah compliant accounting for up to 10 percent of our banking assets in Kenya over the next decade catering for all our retail and corporate clients not just those of the Muslim faith," he said.
Manjang was optimistic that Africa is better placed to enjoy stronger growth than other Standard Chartered markets where Islamic banking is already established due to Africa's ability to adopt best practices already tried and tested through Asian and Middle Eastern markets.
Currently there are two fully fledged Kenyan banks namely First Community Bank Limited and Gulf African Bank that provide Shariah compliant products, and there are several conventional commercial banks that operate windows offering Shariah compliant Products that include National Bank of Kenya and Barclays Bank of Kenya.