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Saturday, January 10, 2015

BOZ launches Islamic Finance Guidelines in Zambia and urges strict adherence to Sharia law.

ZambiaTimes.

Bank of Zambia Governor, Dr Michael Gondwe, this morning officially launched the Islamic Finance Guidelines in Zambia at the Radisson Blu Hotel. Dr Michael Gondwe described the launch as a landmark achievement in the history of banking in Zambia.

He urged financial service providers to put in place appropriate programs and structures to build their capacity to provide high quality and Sharia compliant financial services in Zambia. Dr.Gondwe said this will play a complementary and supportive role to the effectiveness of the supervisory oversight of the central bank in this emerging area in our financial system.

Dr.Gondwe said in Islamic finance, a key consideration of the governance framework is to ensure strict adherence and compliance with the rules and principles of Sharia. I am aware that qualified Sharia scholars, who are a vital addition to the constitution of the corporate governance framework of institutions, may not be readily available. In this regard, there will be need to work with various interest groups in identifying such resources locally.

He said Islamic finance around the globe has attracted significant attention from financial sector policy makers.The Bank of Zambia embarked a process of developing a regulatory framework that would facilitate the introduction of Islamic finance in Zambia. The process involved extensive internal and external consultations with various stakeholders including Government. The framework was reviewed by the Islamic Financial Services Board, which is the standard setting body in matters of Islamic finance. Islamic finance is currently practiced in more than 50 countries worldwide. In many countries, Islamic finance co-exists with conventional finance and is not limited to Muslim countries. Islamic finance is set to continue growing at an annual rate of about 15%.

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