Interest In Islamic Banking ‘Growing In Afghanistan
Bank officials said they are prepared to offer Islamic banking services to the people.
Officials from Kabul-based banks – which provide Islamic banking services – said the number of their customers who are willing to be provided Islamic banking services is growing and that this makes them optimistic to further develop the sector in Afghanistan.
“The number of our customers has increased and the amount of their deposits have also increased. I am optimist in this regard,” said Saleem Rahimi, Marketing Officer in the Islamic Bank of Afghanistan (IBA).
Officials from Afghanistan Banks Association said many banks in the country are prepared to offer Islamic banking services.
“There are some problems which will be resolved in the near future, but the banks are ready to offer Islamic banking services,” said Najibullah Amiri, head of the association.
An economic affairs analyst said government should develop Islamic banking services in order to put people’s money into circulation.
“Attention should not only be paid to development of Islamic banking, but also in other areas such as electronic payments. These kinds of developments will help in decreasing the distance between Afghanistan and developed countries in terms of economic development,” said Hamidullah Farooqi, Head of Kabul University.
Back in April, Afghanistan’s Central Bank has granted a license to the Islamic Bank of Afghanistan (IBA), the first lender in the country to apply the interest-free principles of Islamic finance in all its operations.
The IBA was previously known as Bakhtar Bank and operated under a conventional banking license since it was acquired by Azizi Bank in 2009.
The IBA had paid-up capital of $25 million USD and held $187 million USD of deposits as of December, offering its services across a network of 59 branches, Reuters reported.
IBA estimates that only 5.7 percent of the population has dealings with the banking sector.
According to Afghanistan Banks Association, up to 11 percent of the population in Afghanistan keeps their money in banks, and if the Islamic banking system is expanded in Afghanistan, more money will start circulating and Afghanistan’s financial system will benefit.