The speaker of parliament Rebecca Kadaga has asked Government to quicken the process of operationalizing Islamic banking in Uganda so that all Ugandans can access credit.
She said this during the annual general meeting of the Muslim journalists SACCO at parliament.
Kadaga revealed that a number of Muslim women would like to have money to start up businesses but the shariah law does not allow them to get money with interest.
She has also encouraged the journalists to continue with the savings culture in order to develop themselves saying this must become their way of life.
Islamic Banking is a banking system based on the principles of Islamic or Sharia law.
It is underpinned in application by concepts derived from the Koran and the writings of Islamic scholars. These concepts revolve around the value of a sound currency and fairness in transaction dealings, the latter being structured within the bounds of Sharia law. Parties to any transaction in this banking system are obliged to conduct their business affairs, with a focus on what is permissible and lawful under Sharia law.
In line with its constitutional mandate, Bank of Uganda worked with Parliament to ensure that legislation enabling the introduction of Islamic banking products in Uganda was enacted. Consequently, the Financial Institutions Act 2004 was amended in 2016. The amendments included specific provisions allowing for the establishment of fully fledged Islamic financial institutions and for existing financial institutions to offer Islamic Banking alongside their conventional banking services.
11 out of 22 licensed conventional and Commercial banks in Uganda have expressed interest in Providing Islamic banking products to their customers.