The coming in of the Islamic finance will bring development in general for the Malawian state, says Mufti Ismail Ibrahim Desai, Chief Executive Officer for Global Islamic Financial Services Firm.
The South African based Islamic Financial Adviser said this at a one-day Islamic Finance workshop which he was invited as a facilitator. The workshop was organised by Muslim Association of Malawi (MAM) and took place on February 16, 2017 at Malawi Sun Hotel in Blantyre. It was aimed at drilling the representatives of financial institutions on the need of including Islamic financial services in Malawi.
Mufti Desai said other countries especially in the middle East and Asia that have embraced Islamic Finance, their economy is good because of Islamic financial system.
“And if that is done in Malawi, it will be a big opportunity because it will see new investors coming, some kind of infrastructure development and poverty will be alleviated. Partners in other countries like Malaysia, South Africa, Dubai and Gulf cooperation are willing to come but the challenge is that Islamic Finance is not yet approved in Malawi,” he said.
Speaking during the official opening of the workshop Secretary General for MAM Alhaj Twaibu Lawe said the Islamic Finance will benefit those who fail to take loans from the banks because of the high interest rate which they charge.
He said they already have discussions with the Reserve Bank of Malawi (RBM) and the Ministry of Finance and MAM is just waiting for the approval.
“Most people fail to access loans from the banks that we have because of the high interest rates which they charge and we want to correct this by providing the services that are interest free and it will benefit not only Muslim’s but all Malawians,” she said.
Lawe commended the task force for making a recommended progress for the Islamic bank to be established.
The Islamic financial system has witnessed considerable developments in the past four decades and is now regarded as one of the fastest growing segment of the global financial system.
The key Islamic financial jurisdictions such as Malaysia and the Gulf Cooperation Council (GCC ) have gained much growth and traction over the past few years.
However other jurisdictions in Africa such as South Africa, Nigeria and Kenya have made considerable progress in the growth of Islamic finance.
Bangladesh and Indonesia in the Asian region have shown key potential for growth in the industry. European countries such as UK and Germany have also shown heightened activities in the industry.
The program was initially started in 2013 in Malawi to have the Islamic Banking Institution established in Malawi.
Robert Kumwenda writing from Malawi Sun Hotel. Marshall Dyton in Blantyre also contributed to this report.