Tanzania’s only fully shariacompliant financial institution, Amana Bank, has dished out loans amounting to 36bn/- as of June this year, according to its executives.
The bank’s Manager for Communication and Marketing, Ms Fatuma Mruma, said since the bank made a debut in the market in 2011 it had attracted deposits amounting to 53.5bn/- as of March, this year. “During the same period our clientele has grown to 6,000 compared to 4,335 customers at the end of last year,” she said.
The bank has six branches, four in Dar es Salaam and one each in Arusha and Mwanza. Ms Mruma, flanked by Amana Bank’s Sharia Compliance Officer, Mr Qasim Mohammed, made the remarks in Dar es Salaam yesterday at a news conference meant to inform the public on the progress made by the bank.
“This year the bank is taking part for the first time in the Dar es Salaam International Trade Fair and the response from people who have visited our pavilion is encouraging,” Mr Mohammed said. He explained further that plans were underway to design a product for small-scale businesses, to be dubbed Micro-finance Facility, that will dish out loans as low as 1m/-.
“At present our products focus mainly on medium and largescale enterprises with finances starting from 25m/-, which we know cannot be afforded by small-scale enterprises. We will also have another product for farmers,” the official said.
Sharia banking, otherwise known as Islamic banking, is banking that is consistent with the principles of sharia and its practical application through the development of Islamic economics. As such, a more correct term for ‘Islamic banking’ is ‘Shariacompliant finance.
Sharia prohibits fixed or floating payment or acceptance of specific interest or fees (known as riba, or usury) for loans. Tanzania and Kenya are the only countries in the five-member East African Community (EAC) that have sharia-compliant banking services.
The officials admitted however that since Islamic banking was a new concept in the banking industry, it will be a daunting task to educate the masses on how it operates. They ,however, stressed that even as the bank was consistent with the principles of Islam, it welcomed people of all religious faiths.
By ALVAR MWAKYUSA, Tanzania Daily News