Emirates Global Islamic Bank Limited is all set to capture market share of the rapidly growing Islamic banking industry by offering innovative Riba-free yet highly competitive banking products. This was stated by head of the bank's business activities Syed Khwaja Maaz Khairuddin while addressing members of Korangi Association of Trade and Industry (Kati) here on Thursday.
He said that all products and services, being offered by the bank, were based on the tenets of Islam that prohibited Riba and promoted banking practices based on partnership in which both the parties shared equity and risk.
He said the bank's term deposit was based on the Islamic concept of Mudaraba (partnership). Under this arrangement, the customer was the Rab-ul-Mall (investor) and the bank was the Mudarib (fund manager), he added. He said the deposit would be invested in profitable business ventures that were legal and Shariah compliant. The profit and loss would be shared as per determined ratio.
As per fund manager, the bank would be entitled to a part of profit, whereas profit distribution amongst the depositors and the shareholders would be made according to the weightage assigned at the beginning of each month to their investments, he said.
Through this arrangement, the investors could enjoy attractive Halal profits, he said, adding the bank's auto Ijarah was a Shariah compliant leasing agreement, whereby the bank owned the asset and the customer paid rent for its usage, just like paying rent for a house. The customer would make a 10 percent (minimum) security deposit along with the rental contract, spreading over a period of three to five years. On completion of the pre-agreed period, the title of the asset could be sold to the customers or the asset would be returned to the bank.
Speaking on the occasion, former President of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) S.M.Muneer said that many countries had adopted Islamic banking practices to get rid of Riba.
He said that recently the Bank of England had also introduced Islamic banking. He urged the government to take concrete steps to reduce prices of essential goods. Expressing concern over high rates of mark-up in the country, he demanded of the government to reduce it to a reasonable level. S.M.Muneer assured full support of the business community to the present government.
Welcoming the guests, Kati Chairman Shaikh Fazl-e-Jalil said that large scale manufacturing sector was not performing well, textile sector was in crisis, cost of doing business was on higher side and interest rates were very high. He said that these sectors need special attention of present government, and stressed the need for taking steps on war footing to redress this situation.