Islamic Banking - a fast-growing sector

Hathoon Sheriffdeen

BANKING: Islamic Banking and Finance Industry (IBFI) is a fast growing sector of the global finance market with the monetary value estimated at US $ 0.5 billion to 1.5 billion.

Market forecasts show it to be growing at a rate of 40 percent to 50 percent, a banking expert said at the launching ceremony of "Islamic Finance Today" magazine at the BMICH last week.

IBFI is a management of funds, where funds are invested in various profitable sectors through Islamic financial organisations and the profit or loss has to be transferred to the investors who are the corporate customers with a management fee agreed.

"Most believe Islamic Banking and Finance is applicable only in Islamic countries. European countries have proved that the Islamic Banking and Finance are suitable for any environment.

The Islamic Bank in London is named European Islamic Bank. In Switzerland it is named as No-ribah" Managing Director and CEO First Global Muhammed Ikram Thowfeek said.

Malaysia is another country which follows the Islamic Banking and Finance System most. "70 percent of Chinese are enjoying the Islamic Banking advantages in Malaysia.

Thailand being a Buddhist country the government has contributed 38 percent of the capital on Islamic Bank at Thailand" Thowfeek said.

The global banks are agreed on Islamic Banking and financial ethics internationally.

HSBC and City Bank have their Islamic Banking section called HSBC Amana and Islamic City Bank respectively.

The islamic banking and finance industry has changed the budget deficits of Middle Eastern countries to surplus, Thowfeek said.

In Sri Lanka the Islamic banking and financial industry is not successful due to the lack of awareness of the people, inefficient communication and especially Islamic sentimental values are promoted than the actual value, he expressed.