The House of Representatives on Thursday unveiled plans to adopt non-interest banking services in Nigeria as part of efforts to stimulate the nation’s economy.
The resolution followed a motion sponsored by Rep. Kabir Tukura.
The lawmaker, in the course of reading his motion, stressed the need for Federal Ministries of Finance, Agriculture and Commerce to provide a deliberate policy that will encourage Bank of Industry (BOI), Bank of Agriculture (BOA), Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) Micro Finance Banks and other Government-owned Financial Institutions to provide non-interest banking to their customers.
He observed that “non-interest banking has become acceptable globally as it is seen to be highly efficient and beneficial, expressed optimism adoption of a non-interest banking (NIB) system will stimulate the nation’s economy”, as he urged the “Central Bank of Nigeria (CBN) to review its current policy on non-interest banking and direct Federal Government Development Bank and Commercial Banks to integrate same into their systems, with the view to allow Commercial Banks carry it out as a product rather than having to acquire a separate license for non-interest banking as is obtainable currently”.
The motion noted that” non–interest banking, also known as Profit and Loss Sharing (PLS) banking system prohibits the payment of interest in all ramifications and then adopts the principle of profit and loss sharing between the parties.
“The House also notes that under non–interest banking, both the investor and the entrepreneur are seen as partners, thus when profit or losses are made, same is shared according to the formula that reflects their level of financial participation.
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