Islamic banking coming to Malawi: Muslim Association condemns high interest rates in commercial banks
The Muslim Association of Malawi (MAM) has bemoaned high interest rates that Banks are offering saying this is fostering incidents of property repossession by banks and other lending agencies.
MAM Secretary General Alhaj Twaibu Lawe sounded the outcry in an on Thursday saying the Association is discussing with government and other partners to establish an Islamic Finance Institution which will enable Malawians to lend money without any interest rate attached.
Lawe said it is a pity that Malawi newspapers are now awash with adverts of houses and other properties being offered for sale by banks and estate agents after being confiscated over unpaid loans.
“Malawi’s interest rates, now hovering around 45 percent, remain the highest on the continent and prohibitive for growing businesses. With the ever high interest rates, businesses are failing to grow in the country.
“We have even noted with shock the high magnitude of property being sold in the various newspapers by the various banks. This is a sign that things are not working as desired,” said Lawe.
He said it is against this background that MAM has been holding consultatitive meetings with government and other stakeholders in order to open Muslim Finance, an organization that people can be able to borrow money without interest rates.
Lawe added that Muslim Finance will among other things offer; Banking, insurance and medical aid among other important things.
“Donors out there are willing to assist us with funds and are asking us the progress day in day out. We want people to have a better life in their homes. Once established it will be a facility for all not Muslims only. We are tired to see people being victims of losing their properties,” he said.
Ismail Desai, Chief Executive Officer for Global Islamic Financial Services Firm said the Muslim Finance entity is coming to Malawi to alleviate poverty for many Malawians.
Desai said well wishers from countries like Saudi Arabia, Malaysia and Dubai among other countries are ready to support the initiative.
“We are just waiting for a go ahead and donors will come in. People are suffering with high interest rates from banks,” Desai said.
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Even with such high interest rates, it is almost impossible to borrow money for business in Malawi. It is very very difficult and frustrating for businesses.
At 45% and with the economy in such a poor state, who can afford to repay the loans?
Malawians always sit quiet watching …
Wait.. we who are intelligent can clearly see the writing on the walls of the future
Yes, no interest rates is a good development koma muzasiye kuba