Date Published: 07/18/11
Islamic Banking in Nigeria by Chibuz Aniekwe
I get worried that when there is issue to be discussed people will use it to make a text book of Nigeria History. The point here is not how Murtala died or handed over to Obasanjo then to Shagari et-cetra. The issue is why we think the non-interest but profit sharing, partnership driven and joint venture oriented banking should not be encouraged eithier now or forever.
Remove the prefix "Islamic" so that some level of objectivity could be applied.
For me, this model of banking does not suggest the eradication of the existing conventional practices of interest oriented banking but just to widen the space of participation and encourage the large market segment of moslems who likely stayed away from enriching the financial intermediation process with their deposits assets or loan as liabilities because of their belief system. Note however, that whatever is prohibited is permissible and to that extent, Christianity does not abhor free interest lending so I think it is a convenient point of intersection where all faiths could participate. Is because it is in accordance with Islamic religion? haba!! but Christianity permits it too by not expressly prohibiting it either. The economics of this model of banking though am not an economist by training but by practice is enormous. However if one feel it is otherwise disadvantageous, then bring argument to the fore than crucifying Sanusi just because we heard Islamic. Some day we may hear Islamic and start complaining not knowing the sentence would have ended with "Islamic offers free health care for all Nigerians without conditions attached". Let us shift our paradigm toward those things that unite us than the contrary for we have no choice than to continue to leave together willynilly.
I also like to say that when the muslem Sanusi faced our National Assembly Members eyeball to eyeball to tell them about their unpatriotic expenditure profile even to the point of resigning his appointment while our southern Aganga was talking from both sides of the mouth nobody called him bad names. For all I care, if groundnut pyramid of Kano will bring progress we should support it instead of treating with suspicion because it is made from Kano.
I think the Interest free banking as the model is for those who failed to have "my cup is half full" mentality about it has the ability of strengthening the banks participation in SME Ventures more than ever before. This is because if CBN mandates banks properly in this direction, banks will take sufficient stake as required and follow through both in enterprise and operational risk management in proactive ways knowing full well that they are partakers of profits and losses but not interest any longer.
More beautiful reasons are available if we look at it with optimism.
We shall rather devote to greater enlightenment on this matter than join issue in confrontational ways.