(15 Aug 2017) LEADIN:
Moroccan authorities have given the green light to participative banks, or so-called Islamic banks, to start offering their services to customers.
Two banks in Morocco have become the first to offer their customers financial services that adhere to Islamic law.
After several months of waiting, the "Halal" banks have received the approval of the Higher Council of Ulamas, transmitted by Bank Al-Maghrib, the Moroccan central bank, to launch their activities.
Bank Assafa and Umnia Bank were the first two banks to announce their official launch.
"Today we see that there are a large number of customers who come to us to have information on the products of the participative finance and how it works," explains Youssef Baghdadi, General Director of Bank Assafa.
"Our services are almost the same of others banks, only all our works must be certified by the superior council of Ulamas."
For Bank Assafa, a subsidiary of Attijariwa Bank, this is the culmination of a long journey that began in 2010 with participative finance company Dar Assafa, now a fully-fledged bank.
Umnia Bank, a participating subsidiary of CIH Bank and Qatar International Islamic, opened its doors to clients in all of its agencies located in Agadir, Casablanca, Fez, Marrakech, Oujda, Rabat, Sale and Tangier.
For those who do not wish to travel, the two banks offer online portals that serve as digital agencies.
Baghdadi thinks this will be a positive move for the Moroccan economy.
"It can only be good for us Moroccans to have other supplementary offers on the market, and then everyone can choose whether or not it will be a conventional bank or a participatory bank."
These banks have also been authorised to grant "Halal" real estate credits, called "Murabaha", but they can not offer insurance.
The Murabaha contracts are also ratified by the Sharia Committee for Participatory Finance, the Higher Council of Ulamas (CSO) and sent to the banks by the Central Bank.
"When I found out about the launching of the Murabaha process to finance a house or a car, I came here because it is in accordance with Islamic law," says customer Mustapha Laabssi.
"I've been waiting for the start of participative banks in Morocco. Today I am here to have information about the financial products of the bank, and I hope that I find here what I am looking for."
Islamic finance prohibits, amongst other things, the practice of interest and speculation as well as investment in gambling or pornography.
Rather than pay interest, people buying a home enter into a contract of joint ownership with the bank and pay "rent" to live there.
Many people support the introduction of these new services.
Fatima Machkor and her husband Lahssen Moussaif flew over from Canada to help their son with buying a house.
"We are satisfied with this bank, they provided us with all the facilities," says Machkor.
"My son was happy with this bank who offers different services than traditional banks, I think the bank will have a continuity and a good future," agrees Moussaif.
In Morocco, the Higher Council of the Ulamas, an official institution in charge of supporting the religious policy of the kingdom, is the only body authorised to issue fatwas (decrees) on the conformity of participatory finance products.
Ten applications for accreditation were submitted to the Central Bank in June 2016, mainly by Moroccan banking groups associated with Islamic banks in the Gulf.
Islamic finance, whose development prospects appear unlimited, now represents some 2,000 billion dollars (1,717 billion euros), and could double in volume to 4,000 billion dollars in 2020.
As a reminder, the Governing Council, meeting on 13 July, adopted Bill no. 40-17 on the status of Bank Al-Maghrib (BAM).
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