BSE and TASIS train business executives for Islamic banking & finance

Mumbai: Corporate executives and finance professionals learning and discussing financial business market issues in conference rooms at Bombay Stock Exchange (BSE), is a normal scene but what happened last week was unprecedented.

This time they were learning and discussing Islamic banking and finance at a program jointly organized by Taqwaa Advisory and Shariah Investment Solutions Pvt Ltd (TASIS) and BSE.

Training program on Islamic banking and finance held at BSE, Mumbai

TASIS and BSE organized the two-day program “Islamic banking, finance and capital market” (16-17 Dec.) for market professionals, fiancé and banking executives. The push might have come from growing Islamic banking and finance sector across continents.

Islamic banking and finance has reached the boundaries of more than 75 nations of the world, and many developed and secular nations including UK, USA, France, Germany, and Singapore are promoting this concept.

The robust performance of Islamic banking and finance sector during the recent financial downturn has added to its magnetism.

Western nations such as UK, are promoting Islamic finance with the slogan of “no favor but no discrimination”. Same way in India many institutions including some owned by government have showed interest to capitalize on this growing niche opportunity.

For example Kerala government owned KSIDC has started Al-Barakah Financial Services Ltd; GIC of India has started Islamic re-assurance scheme, SEBI has permeated several schemes explicitly adhering to the Islamic rules of investment, and Bombay Stock Exchange has started a Shariah index for share marketing.

The two-day program by TASIS and BSE was organized for finance professionals, fund managers, merchant bankers, corporate financial advisors, portfolios managers, and product development managers, finance marketing professionals, chartered accountants, stock brokers, wealth managers & AMCs. The program mainly focused on the following:

•        The basic concepts of tenets of Islamic banking and finance

•        The working of an Islamic bank

•        Islamic law relating to investment in the stock market

•        Screening processes of selecting shariah compliant stock

•        Islamic insurance

Program to train professionals for coming Islamic finance market

TCN spoke to Dr. Shariq Nisar, Director of TASIS, on the program and its purpose. The reason to organize this programme was that many business professionals were interested in knowing about Islamic finance, so by the way of this programme professionals will get aware of the Islamic finance, and also when Islamic banking is going to start in India and if the people are not aware of it then the chances of exploitation is very high. So to avert that kind of situation this programme is conducted, said Dr Nisar.

He says it is first kind of programme organized by the BSE for the professionals who want to learn about Islamic finance. He further says that majority of the professionals attending this programme are non-Muslims, and non-Muslims professionals are showing curiosity and interest in learning about Islamic finance, and how Islamic banking and insurance can function and also the Muslims who are attending this programme are seeing it from business operational point of view, and not in a religious way.

India needs Islamic finance for growth: Dr Shariq Nisar

Dr. Nisar says Islamic finance in India depends on two important aspects: First is the domestic demand; and the second is India’s position in the globalization of the financial sector, because domestically India is unable to generate enough capital largely because its major Muslim population is being discouraged to enter into the Indian market because of the perception of Haram, and globally the large number of global capital is getting generated from middle east or many other Islamic countries.

So if India wants to satisfy the demand of investment and capital it has to have an Islamic financial market both domestically and globally, and India will definitely be going to have a Islamic financial market very soon. The sooner India does it, the better for the nation and the whole economy, he ascertains.

Dr Shariq Nisar, Director, TASIS, giving market executives tips about Islamic banking and finance

He said the shariah index started by the BSE is just a one step. It is not the end. There is going to be much more research by the BSE and TASIS to certify many more shariah compliant products and the Islamic banking. He says Islamic finance is not just for the minority Muslim population in this country, but it is for the money.

The nations which have allowed Islamic finance were not lovers of Islam. For example France allowed Islamic finance but in the same month it banned hijab. Different countries and people are attracted towards Islamic finance for the need of money.

He said Islamic finance is all about the real economic activity, it doesn’t allow gambling with the money, in this way it can restrain economic downturn by promoting real economic activity and deterring people to gamble with money so it will be in the larger interest and welfare of the citizens of this country.

He says India is a country with huge Muslim population but still it is far behind in implementation of Islamic finance. Muslims in this country have money but they don’t know how to invest it financially, nor even banking professionals know as to how to guide their Muslim customers to invest in the commodity market.

So this type of programme is conducted by the BSE and TASIS to train the banking officials in the Islamic finance.

Young market executives on Islamic Finance

TCN also spoke to some of the finance professionals who were attending the programme.

Varsha Jalan is an employee of a law firm giving legal assistance in the finance related matters. She said reason for joining this programme is to develop her expertise in the growing Islamic financial market, and because it could be a good mode of finance in India.

Sumit Jalan and Yasmeen both belong to the banking profession. They said that Islamic finance has a good potential in India because of the large number of Muslim population which India possess, but at the same time they ascertain it should not be limited to a particular community because it is very viable and economical than other services, so every person should get avail of this service.

Finance executives Yasmeen, Sumit and Varsha attending the workshop on Islamic banking and finance held at BSE, Mumbai

Varsha says that the programme was informative, and she learned new and surprising things about the Islamic finance and about the tenets of Islam. She thinks Islamic finance is a good way for India to attract FDI because India is in need of money and for Middle East India is good alternative to the west.

Sumit and Yasmeen said that they learned many things about how the markets and MNCs work in Islamic countries and it was useful for them as they come from the banking sector, and it was good experience for them to learn about the core principles of Islamic finance.

Sumit says that to attract FDI in the banking sector you need to have knowledge of the environment which investors are looking forward for their investment, so the knowledge he gained will be useful for him in the future. Yasmeen said being a banker learning something new regarding to their profession was a pleasant experience for her.

Islamic Stock Market Investment

Islamic investments have found their footing in the global stock exchanges by offering Shariah indexes and ETF’s. Mufti AHMED SULIMAN and YUSUF MOOLA discuss their features.

Investment in the stock exchange is not exclusive to any one state or country. The global trend has shown that stock market investments play a significant role in the economy. A good economic state of affairs leads to a boom in the stock market while a poor state of affairs sends the stock market crashing.

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Setting the scene

The purchase of an ordinary share in a larger business is referred to as a Musharakah (partnership). Upon acquisition of the share one becomes a partner in the business.
There may be two scenarios here:
a. The company has liquid and illiquid assets
b. The company only has liquid assets (cash).

Continue reading

Islamic insurance – Smart Solutions for your future

Most people still ignore the existence of insurance. Also, if the type of work do not have a big risk, such as accidents or death. Plus more news not gone sour on insurance, such as: filing an application, the money was deposited charred when process participants are unable to pay a premium in the agreement, the amount of the refund is less than prizes that have been filed, or any other that is considered detrimental to the uncertainties of the participants of the insurance.

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However, it has now been present of Islamic insurance which is based on the principle of help as well as much of the riba and the uncertainty that has banned the religion.

Through this Islamic insurance, participants can invest a portion of their wealth without worrying about charred if subjected to constraints of the payment of the premium each month. When the agreement is concluded, participants will receive a refund of amounts exceeding the amount of the premiums that have been deposited since it uses the principle for the results. The Islamic insurance also manages a fund enters in a way that is lawful and invested in the company of Sharia compliant.

The development of the value of savings and for the results to the right of participants will be reported every month because they adhere to the principle of transparency. Join the Islamic insurance makes life more quiet, good in the world and the hereafter.

The primacy of Islamic insurance Investing in Shariah-compliant insurance more profitable than saving money in the Bank. The real story occurred to a participant a Shariah-compliant insurance. He signed a 1 year old son to a Shariah-compliant insurance costs to prepare for the next 10 years.

 Just pay a prize in the third, his son was ill and had to be taken by photography. In fact, are a vacation out of town. Incidentally, the city’s large hospitals are indicated for the insurance. He has just delivered the insureds for the administration of the hospital and focused for the healing of the son.

Five days later, his son was allowed to return home. That surprise him when the administration of the hospital informed him that the total cost of RS of 4.2 million rupees had been imposed on all sides of Islamic insurance. In fact, the total premiums that he setorkan the new insurer of 900 million rupees (3 x 300 thousand rupees). Compare if the money is he tabungkan to the Bank, of course, just might take some 900 thousand rupees (or less) and have to find extra money to complete the rest until the reached number 4.2 million rupee. Benefits of joining Islamic insurance clearly evident here. You can invest for the future of education costs or son/daughter, as well as obtain health insurance.

Tips for choosing Islamic insurance Not only Muslims, non-Muslims who too joined the Islamic insurance because of its superiority. Various Islamic insurance company emerged. No need to confused to choose which is best for you.

Here are tips that you can do to get an insurance agent that is right for you and for the future of your family: Identify three or four Islamic insurance company that is in the town of AndaPilih with a referral hospitals in the cities often visit you and your family.Compare the advantages of the products we offer.Do you know of a company compared to pros standings of another company through a reliable and independent magazines like Investor Magazine, MajalahInfoBank and Marketing Magazine. looking for news in print or in electronic format, either in the form of praise or complaints against insurance companies, some participants as material consideration No one knows what will happen in the days to come. Therefore, they prepare to face all the possibilities. One of them, by investing in Shariah-compliant insurance. Give rating an article on crappy less usual nice nice Incoming search terms:

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Islamic banking: Features of accounting

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Afzalul Haq in the first of his three-part article

Islamic banking: Features of accounting

Now-a-days accountancy has become an important academic and professional discipline as the lingua franca or language of business. As such in the real life industrial scenario, accounting has become the vital part of the top management. Continue reading

Shariah-based investment products set to flood markets

AHMEDABAD/MUMBAI: Shariah-compliant personal investment products are slated to flood the market as exchanges and mutual funds seek to tap Muslim investors who refrain from trading in stocks and commodities. While the MCX-owned National Spot Exchange Limited (NSEL) plans to market shariah-compliant investment products in a fortnight, SBI Mutual Fund and UTI Asset Management are looking at ways to launch such products in the next few months.

Tata Mutual, Benchmark Asset Management , Taurus Mutual and Sundaram Mutual Fund have ethics-based investment products already. Kotak Mutual, ICICI Pru Asset Management , Reliance Mutual , HSBC and UTI Mutual Fund have a series of shariah-tolerant offshore funds that allow foreign investors to invest in Indian stocks.

NSEL has got its e-series products such as e-gold, e-silver and e-copper shariah-compliant through which retail investors could buy the commodity in demat form at real-time Indian prices. Taqwaa Advisory and Shariah Investment Solutions , a Mumbai-based shariah advisory institution, has certified NSEL’s investment products. “There was a huge demand coming from Muslim investors: waqf boards, masjids, HNIs and traders who wanted products which were shariah-compliant. Initially, we expect volume to increase by 15% to 20%,” said NSEL MD and CEO Anjani Sinha.

He said more products were getting certified. Analysts point out that platinum and agri commodities which have higher liquidity and a deep market could be the other products to be certified. With an investor base of 67,000, NSEL has plans to launch 15 more commodities on its electronic exchange.

Islamic fund management industry set to gain momentum

Indeed, Zarinah Anwar, chairman of the Securities Commission Malaysia (SC), the securities and fund regulator, confirmed at the International Shariah Investment Convention 2010 which was held in early December in Kuala Lumpur and organized by the SC; Bursa Malaysia, the stock exchange; and Amanie Business Solutions, that Malaysia’s Islamic fund management industry is the fastest growing segment of Malaysia’s Islamic capital market (ICM) with an annual compounded growth of more than 25 percent over the last 5 years.

Islamic fund management industry set to gain momentum

Islamic fund management industry set to gain momentum

However, statistics can be very misleading given that the base is very low and the Islamic investment fund industry still constitutes the smallest portion of the overall market which has been dominated by products such as Murabaha (cost-plus financing), Bai Bithaman Ajil (deferred payment), Ijara (leasing), Tawarruq (cash management) and sukuk (Islamic trust certificates) over the last decade or so. At best, the Islamic investment fund universe totals no more than an estimated $30 billion compared with an estimated $130 billion for sukuk.

Given the volatility of the stock markets, especially in the GCC countries where ordinary investors lost life savings on the equity markets a few years ago, GCC investors are cautious about investing in stocks. But with the real estate bubble bursting in the aftermath of the credit crunch and the global financial crisis, confidence especially in the GCC markets such as Dubai, Bahrain, Kuwait and Qatar in the traditionally favored real estate investment asset class has also taken a hit. Whether the Gulf preference for “bricks and mortar” investment continues remains to be seen.

The opportunity for Islamic asset management companies and investment banks to come up with innovative products that carry an element of capital preservation and decent returns is clear and present. Bankers very often complain about GCC investors wanting high returns with low risks that go against the grain of investment dynamics and the ethos of Islamic investment.

Nevertheless, according to Zarinah, “The Islamic fund management segment has been fully liberalized with attractive tax incentives offered by the government. We now have 15 full-fledged Islamic fund managers operating in Malaysia, including some of the biggest names in the international fund management industry. We have 152 Islamic unit trust funds with a total Net Asset Value of 23.02 billion Malaysian ringgits ($7.1billion).”

In order to further develop Malaysia’s Islamic fund management industry and to enable Malaysian investment products to be offered abroad and foreign products to be offered to Malaysian investors, the commission has actively pursued mutual recognition arrangements with other strategically important markets such as the Dubai Financial Services Authority and the Securities and Futures Commission of Hong Kong. These agreements, according to the SC, help to widen the industry’s distribution network and promote exchange of ideas to enhance product offerings, especially for funds meant for regional distribution.

Earlier in December, the SC signed a Memorandum of Understanding (MoU) with the Qatar Financial Markets Authority (QFMA) in Kuala Lumpur whereby the two capital markets regulators would strengthen cooperation and cross-border enforcement to enhance overall investor protection including in the Islamic investment fund and asset management sector.

The MoU was signed by Zarinah and QFMA Chief Executive Officer Nasser Ahmad Al-Shaibi. According to Zarinah, “In an increasingly complex financial environment, it is important for regulators to continue to strengthen their cooperative networks through greater information-sharing and collaboration in capacity building.”

Al-Shaibi similarly explained that “the MoU clarifies the importance of the exchange of technical support between the authorities in matters relating to the regulation of the securities industries. The authorities will also work together to determine the training and technical needs for the development of the stock markets for both countries, subject to the availability of the appropriate expertise and resources.”

The SC is committed to strengthening international cooperation in securities regulation and has signed 29 such MoUs with foreign capital markets regulators since 1994.

Malaysia, stressed Zarinah, is also fast becoming a center for Islamic fund and wealth management services and for international Islamic banking services, as well as a center for Islamic finance education, training, consultancy and research. All these sectors are supported by facilitative policies and underpinned by clear and robust regulatory as well as Shariah governance frameworks.

In terms of equities, Bursa Malaysia, with 961 listed companies, offers the widest and largest selection of companies in ASEAN. Currently, 88 percent of the stocks listed on the exchange making up 62 percent of total market capitalization are Shariah-compliant. Dividend yields for Malaysian stocks are currently estimated at 3.4 percent that places it among the highest in the region. This is supported by sustainable earnings growth with returns on equity estimated at almost 20 percent. The Malaysian equity market also offers investment opportunities in Malaysia’s best and largest companies, some of which have strong regional presence.

Are Shariah advisories becoming an endangered species?

Not that the issue is new. There have been calls for the registration of Shariah advisories for the last two decades — not by an industry Shariah body but by the regulators in the country in which they are based and in those countries in which they offer advisory services.Market players have long been concerned by the small pool of experienced Shariah advisers serving the Islamic finance industry and that an elite few sit on as many as 89 boards per adviser. This they claim could lead to conflicts of interest and is simply not the best practice in terms of advisory.

Are Shariah advisories becoming an endangered species?

Are Shariah advisories becoming an endangered species?

True financial services clients do complain that many of their Shariah advisers are sometimes very difficult to get hold of simply because they have so much on their plate because of the number of boards on which they sit and some of them have teaching commitments at universities and colleges.

Not surprisingly, some of the top Shariah advisers have reportedly spoken out against any efforts to restrict their trade by restricting the number of boards on which they can sit on. With due respect to AAOIFI, its efforts will carry no weight, simply because they are not steeped in law and they only carry voluntary adoption — a feature which is not very established or strong in the Islamic finance culture and industry.

There is of course an eminent precedent in this issue — the case of Malaysia, where not only have all Shariah advisories got to be registered under section 377 of the Capital Markets and Services Act 2007 (CMSA) and the provisions of the Central Bank Act 2009. Similarly, in Malaysia an individual Shariah scholar can only sit on the board of one institution in a particular market segment — commercial bank, investment bank, Takaful operator etc.

This is the law of the land and any Shariah advisory that does not like it is free to leave and do business elsewhere. The above measures have not led to any exodus of Shariah scholars from Malaysia. On the contrary, it has given space for the emergence of the new generation of Shariah advisories for the growing Islamic finance market. Similarly, the UAE Insurance Authority has reportedly already introduced regulations that restrict Shariah advisories to sit on no more than two Shariah boards of UAE Takaful operators. Similarly the State Bank of Pakistan is also following the Malaysian example.

One senior executive at a major global financial consultancy stressed to Arab News on the basis of anonymity, “My gut feeling is that the Malaysians are right. The same argument can be applied to the global consultancies such as KPMG, PriceWaterhouseCoopers (PWC), Ernst & Young (E&Y) and Deloittes etc, but the difference is that they are now in a mature industry. I do not think that Islamic finance is necessarily a mature industry and, as such, may need external guidance. The other difference, of course, is that the Big Four accounting firms are regulated externally, something the scholars cannot claim to be. In addition, while the Big Four accounting firms are auditors to the banking majors such as Citigroup, HSBC, Deutsche, Standard Chartered Bank, BNP Paribas, Societe Generale, Credit Suisse, UBS etc, they have different partners involved on each account and Chinese Walls in place.”

Why is the registration of Shariah advisories and the restriction of the number of boards they can sit on potentially beneficial to the Islamic finance sector. The reasons are manifold.

According to [email protected], overall there are 1,141 Shariah advisory board positions available in 28 countries. The average board size is 3.33 scholars per board, across the entire universe. Perhaps more importantly, the top 10 scholars hold 450 out of 1,141 board positions that are available and represent 39.44 percent of the universe. Two Shariah advisories sit on a staggering 85 boards while another on 79 boards.

It does not require expertise in mathematics or quantum physics to ascertain that apart from conflict of interest, it is nigh physically impossible for a single scholar to service so many accounts. He or she would have to be a wonder scholar or a super advisory, arguably with magical powers. And no amount of hard work can mitigate this fact. It would be of course a different case if the scholars are organized as Shariah advisory companies but with more than one Shariah partner, in the same way the accounting, auditing and legal firms are structured.

This impacts on the quality of the Shariah advice and the efficiency of the process. This is important because the longer it takes for a Shariah advisory to advise because of pressure of work due to the number of accounts and less time, the more the cost of the Shariah advisory. This is inevitably passed on the hapless customer and is particularly so in the case of a new product or service.

The next logical step in Shariah advisory is for the eventual phasing out of individual scholars sitting on boards and being replaced by Shariah advisory firms or consultancies, which would have a pool of Shariah scholars with the same hierarchy in terms of expertise and management.

The registration requirement would also weed out the self-styled amateurs from the real experts, who in fact have more to gain from such a development. In Saudi Arabia, a few years ago there was a free-for-all when self-styled Shariah scholars were giving fatwas “legitimizing” the real estate investment offerings of a spate of companies, many of whom were not even registered by the Ministry of Commerce let alone the regulatory authorities. The result was that ordinary investors were exposed to potentially huge losses and only the intervention of the Ministry of Interior (not the Ministry of Finance, nor the Saudi Arabian Monetary Agency (SAMA) saved them from disaster.

Shariah scholars argue that registration requirement and restriction to one board would stint the growth of the global Islamic finance industry. This argument may have been valid in the past, but more universities especially in Malaysia, Jordan and Kuwait etc. are churning out the next generation of Shariah advisories, who are not only competent in Fiqh Al-Muamalat (Islamic Law relating to financial transaction) but also familiar with modern banking and finance.

Similarly, some Shariah scholars argue that in many countries there is no critical mass of scholars. This argument is self-defeating because with a pool of over 1,141 scholars there are enough to go around. Individual scholars too are not restricted to give advice to banks only in their home market. They can do so in other countries as long as it is for one institution per market segment.

However, the spectacular growth of the Islamic finance market may also turn out to be the end of days for Shariah advisory as we know it today. The market is getting sophisticated and bankers also are now much more familiar with the structures of Islamic financial products. A new generation of Islamic bankers are emerging who are conversant with both Islamic financial law and with banking and finance.

As such, Shariah advisories should realize that the more the sector develops the weaker their position becomes. In the halcyon days of Islamic finance, Shariah advisories were put on a pedestal partly because of the ignorance and unfamiliarity of the bankers with Fiqh Al-Muamalat. Today the situation is changed dramatically and scholars are now in a position of weakness.

In Malaysia, for instance, they are rigorously regulated. Even some of the top GCC scholars operating on Malaysian boards are registered with the Securities Commission Malaysia and are subject to the provisions of its act. So, if they already succumb to the Malaysian legal provisions, why not in their own countries.

Shariah advisories can complain as much as they wish to, but if their home regulators decide to adopt the Malaysian example, then they will be obliged to follow the provisions of any new laws governing the registration and regulation of such Shariah advisory in Islamic finance. They can of course take out legal action against their regulator perhaps under restrictive trade regulations (if they exist) or migrate to another jurisdiction where such laws are not yet in place.

In Malaysia, the law is very comprehensive and has provisions on criteria for registration, renewal of registration, fit and proper requirements, and even for foreign Shariah advisories operating in the local market.

Instead of resisting change, Shariah advisories should rise to the occasion to embrace change. Lest, individual Shariah advisories sitting on a cornucopia of Boards, are increasingly becoming an endangered species.

HSBC Islamic arm eyes 125 new branches by 2012

DUBAI  (November 08, 2010) : HSBC Amanah, the Islamic arm of bank HSBC, plans to open 125 branches throughout the Middle East and Asia by the end of 2012 eyeing rapid growth in the $1 trillion Islamic finance industry, a top executive said.

— HSBC Amanah plans largest branch increase in Malaysia

— Wakala Master Agreement with IIFM progressing

Middle East and Asian markets will fuel growth in the industry with compounded annual growth rates of over 6 percent in the next five years, said Razi Fakih, HSBC Amanah’s deputy chief executive in an interview with Reuters on November 04. Continue reading

Is Islamic Finance the new challenge to Wall Street?

I was in Kuala Lumpur in October attending the Global Islamic Finance Forum, organized by Bank Negara Malaysia and the Malaysian International Islamic Finance Centre. The whole glitterati of the Islamic world was here, and coincidentally, the HSBC Asia Board also held their meeting here, so it was also good time to catch up with all the Hong Kong good and great, including the incoming taipans at the Bank.

In the 1990s, Islamic finance was a fledgling fringe industry. But today, its size has grown from roughly US$150 billion to about US$1 trillion in size. This is of course still small relative to some of the largest global fund managers and universal banks, who manage more than US$1 trillion each. But the double-digit growth and potential size of the market cannot be ignored. Some pundits think that the market size will reach US$2 trillion within the next five years.

There are roughly 1.3 billion Muslims in the world, with 138 million in India and roughly 30 million in China. These are growing markets in terms of income and wealth. As the Muslim community seeks to invest in interest-free banking, Islamic funds have been growing in leaps and bounds. Today, there are roughly US$800 billion in Islamic banking funds, US$100 billion in the sukuk (or Islamic bond) market and another US$100 billion in takaful (Islamic insurance) and fund management business. Hong Kong, of course, introduced the Hang Seng Shariah Compliant China Index Fund in 2008 to attract Muslim investors. Continue reading

CMA to set up Sharia investment regulations

The Capital Markets Authority is working to set up rules and regulations that will allow development of Shariah-compliant products.Speaking during the unveiling of a new name by ApexAfrica Investment Bank to ApexAfrica Capital, CMA chief executive Stella Kilonzo, said her team has already visited Mauritius to study how Shariah-based investment products are operated and regulated.

“There is a lot of potential for Shariah-based investment products and we will work together to develop them,” said Ms Kilonzo in appreciation of announcement of the intention by ApexAfrica Capital to launch such products.

ApexAfrica Capital CEO, Kassim Bharadia (left) and Capital Markets Authority chief executive Stella Kilonzo during the unveiling of a new name from ApexAfrica Investment Bank to ApexAfrica Capital

Interest earning

During this year’s budget speech, Finance minister Uhuru Kenyatta urged the market regulators, CMA and Central Bank, to introduce Shariah-compliant products as a way of offering Muslims investment options.

By religion Muslims are prohibited from investing in interest earning products in preference for profit sharing.

They are also forbidden from investing in alcohol and gambling industry.

Speaking at the event, ApexAfrica managing director Kassim Bharadia said his company has developed Shariah products and was in process of launching them once the regulatory mechanism is in place.

Great promise

“Demand for Shariah-based products in financial services is growing, we now have Shariah banking, and Shariah insurance products have also been developed. The area that is lagging is Shariah-based investments products, a business in which ApexAfrica Capital has planned products,” said Mr Bharadia.

Earlier in the year Central Bank of Kenya launched a Shariah-compliant bond during the second infrastructure bond to raise money for construction of roads, water and sewerage systems.

“We see Shariah investment products as an area with great promise, we have not only seen local interest but we have attracted a lot of interest from international organisations,” he said.