Islamic finance growing rapidly: Sindh governor

Sindh Governor Muhammad Zubair said that Islamic finance has been growing rapidly in not only Muslim countries but also in non-Muslim countries.

Addressing participants at the inauguration of the 6th Islamic Finance Expo and Conference organized by The Professionals Network (TPN) here on Thursday, Zubair stressed the need to convince people towards Shariah-complaint banking as more than 95 percent of people strongly believe that conventional banking is against Shariah rules.

The current 14% share of Islamic banking in the overall banking industry is not sufficient and needs to be enhanced, he said.

He stressed that for the development of Islamic banking in Sindh all stakeholders will have to work together. “Sindh lags far behind in terms of development,” said Zubair.

Speaking on the occasion, Meezan Bank CEO Irfan Siddiqui sought government’s attention towards development of Islamic banking at par with the conventional banking by introducing Shariah-based financial instruments.

Siddiqui also pinpointed problems of Islamic banking industry in Sindh where according to him “lending by Islamic banks was the most difficult task” due to safety and return reasons.

“Bankers are reluctant to extend loans in the province, whilst Punjab has made significant progress in the financial sector,” he added.

According to Siddiqui, Islamic banking is growing as ADRs of Islamic banks have gone up by 57% of the total banking industry and total share of Islamic banks’ has increased to 13%.

TPN CEO Mehmood Tareen said that the purpose of organising the expo was to promote Islamic banking and products in the country by introducing Shariah based products at a vibrant forum. “It is a platform where people gather to exchange their ideas about the Islamic financial industry in a rightful manner,” he noted.

Karachi Chamber of Commerce and Industry Banking and Insurance Sub-Committee Former Chairman Ateeq ur Rehman said that 82% of small and medium size enterprises are neglected and do not get financing from conventional banking sectors.

“Islamic financing has been offered to them and they feel more comfortable to get finances through this route,” he added.

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