KCB has launched its Islamic banking unit as it seeks to tap into the growing demand for Islamic financial products across the East African region.
The launch paves way for the full roll-out of Sharia’h compliant products under the proposition dubbed “KCB Sahl Banking” (easy banking), which will provide Shariah compliant banking products that prohibits the giving or receiving of interest and ensures that money is invested ethically in accordance with the Islamic faith.
KCB Group Chairman Ngeny Biwott said the launch is part of the bank’s long term vision to diversify its product offering while riding on technology as it reaches out to more citizens across East African and beyond who feel left out by the conventional banking system.
“This chapter is a milestone for our financial inclusion and deepening agenda for the banking and financial services sector to be accessed by everyone in the region. Looking ahead into the next three years, this product will progressively facilitate development in the marginalized areas and deepen financial coverage,” said Mr Biwott.
This comes a time when KCB Tanzania is offering Islamic Banking services. The KCB Group Chief Executive Joshua Oigara said that with everything in place, the Bank is ready to revolutionise the Islamic Banking space in the country. “This service is a Shariah compliant bank account designed to address the sensitivities of this group of customers,” said Mr Oigara.
The Islamic form of banking, which targets both Muslims and non-Muslims, has continued to gain traction globally with latest statistics from the World Bank indicating that global Shariah compliant financial assets have increased significantly over the past three decades, reaching about $1 trillion in 2010 up from about $ 5 billion in the late 1980s. It is expected that Islamic banking assets will grow at a 19.7% over 2013-2018 to reach $1.6 Trillion by 2018. Currently, Sharia’h banking products account for 2% share of the market share in Kenya.
Speaking during the launch, Cabinet Secretary National Treasury, Henry Rotich said that the government will continually review the Banking Act and Prudential Guidelines to reflect this new reality as is the case in South Africa, Europe, the United States, Canada, the Middle East, and Australia.
For a start, KCB will roll out the Islamic Banking products in six of its branches as ahead of a national roll-out. The branches are KCB Eastleigh, Kimathi Street, and Hurlingham in Nairobi; Mwembe Tayari and Town Centre in Mombasa; Garissa and Wajir in North Eastern and Lamu. These satellite branches will serve as an operating model as the Bank seeks to enhance quality growth to create sustainable shareholder value.
The Bank has so far created various asset and liability products under the Sahl Banking proposition among them Mudharaba, Qard Hassan, Wadia, Murabhaha, Musharaka and ijara.
That’s a good move kcb bank….. Everyday I watch on Television about job Sahl bank… I am so interested to be part of the team in the Kcb bank if given an opportunity…. May you be blessed.