Islamic Finance | |
Islamic Finance | |
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Friday, May 01 , 2020 / 12:56 PM / Bukola Akinyele for
WebTV / Header Image Credit: WebTV
Islamic Finance through Waqf Crowd Funding could
support Nigeria's efforts at mitigating the adverse impact of the novel
coronavirus on the economy.
Dr. Aliyu Dahiru Muhammad, the Deputy Director,
Training and Linkages, International Institute of Islamic Banking and Finance,
Bayero University Kano, BUK noted this in an interview with WebTV's
Islamic Finance Weekly.
According to Muhammad, Waqf which is a form of
endowment in Islamic Finance, is an avenue to mobilize wealthy Muslims and even
less wealthy individuals to contribute funds to address a social cause.
The type of cause range from Education, Health,
Environment to even Charity and comes at a critical time when the globe is
experiencing the adverse impact of COVID -19.
Experiencing revenue challenges and seeking
funding from international financial institutions like the IMF, Dr Muhammad was
of the view that Nigeria could benefit from instruments like a Waqf fund, to
support the healthcare and other segments of the socio-economic environment.
Waqf Crowdfunding platform, according to him,
could generate funds for the Nigerian economy, encouraging a huge population of
over 100m that could see both the rich and poor donate as little as N100.
From the funds raised from Waqf funding,
the Islamic Finance expert believed massive healthcare intervention could be
achieved in Nigeria.
He called on economic policy makers to
explore leveraging the opportunities in the non-interest finance market, citing
an interest-driven global market as part of the reasons for the economic
slowdown experienced by various nations.
The
Islamic Banking and Finance scholar acknowledged the current steps by the
Federal Government, to revise the 2020 budget assumptions to face the realities
of the current plunge in International Crude Oil price.
Dr
Muhammad also noted that the Islamic Development Bank, IsDB (IsDB) has set
aside a $2.3bn response facility for the Organization of Islamic Countries
(OIC) which Nigeria as a member can also access for funding.
He
stressed the need for the Federal Government to explore how to integrate
Islamic Finance into its development agenda, considering the non-interest
provisions.
According
to the finance teacher, Waqf provides opportunities different from Sukuk
which is normally used to generate long term financing projects.
Looking
at the Nigerian economy he lauded the efforts of Jaiz Bank a non-interest bank
which has set aside N4bn to support micro, small and medium enterprises (MSMEs)
within 8 months which is first of its kind in Islamic finance markets.
The
current global size of Waqf in terms of valuation is currently put at
over $100bn and provides an avenue to boost sustainable financing.
Speaking to the season of the Ramadan fast for Muslims across the globe, he listed the objectives of shariah which include;
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