Islamic banking licensed in South-West in 1963 – Don

islamic bankingBy Agency Reporter

An Islamic Scholar and University of Ilorin Lecturer, Dr Ibraheem Abikan, has said that Islamic banking was first licensed in the South-West zone in 1963.

Abikan made the disclosure on Monday in Ibadan while delivering the 13th Ramadan Lecture entitled, “Viability of Islamic Banking in Nigeria, Issues, Challenges and Prospects.”

The event was organised by the Muslim Lawyers Association of Nigeria Oyo State branch.

He said that the bank was then known as “Muslim Bank of West Africa”and was licensed under the regulatory body of the financial institution of the era.

The lecturer explained that the licence was later withdrawn by the authorities of the then Western Region barely after four years of operation.

Abikan said that it was unfortunate that the government at the region did not allow the bank to operate fully.

He said, “Unlike the fixed deposit account that operates in the conventional banks, Islamic banking only allows for the general purpose investment account.”

According to him, general purpose account encourages distribution of wealth according to the profit or loss made by the bank on every investment it undertakes with the active backing of the shareholders.

The bank, according to him, is interest-free and is capable of giving a leap to Nigeria’s socio-economic advancement as being witnessed in other countries.

The lecturer admonished those criticising the CBN Governor, Mr. Lamido Sanusi, to be fair in their criticisms and allow the bank to operate and see whether the wide gap between the rich and the poor will not be drastically reduced.

He called on all Nigerians to do away with sentiments and give the bank a chance.

The Chairman, MULAN, Tajudeen Abdul-Ganiyu, said the lecture was chosen because of the need to enlighten the public on why Islam forbade interest-taking by banks, saying “Islam totally forbids interest on loan.”


Source: Punch


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