Lagos – Some financial experts have called for effective supervision of non-interest banking to ensure its success and integration into the Nigerian economy.
They said in separate interviews in Lagos on Tuesday that its implementation should be properly monitored to forestall a recurrence of banking sector crisis of 2008.
They said non-interest banking would accelerate expansion of the banking system in Nigeria if well embraced.
Jaiz Islamic Bank, the first to be given licence, started operation in February in Abuja, Kaduna and Kano.
Mr Eddie Osarenkhoe, a former President of Finance Houses Association of Nigeria (FHAN), said that non-interest banking would make more Nigerians to embrace banking since the bank would not charge interests.
He advised that Nigerians should not be biassed on the new banking system, stressing that it would re-orientate conventional banks to be more efficient.
Osarenkhoe said that non-interest banking would bring about competition among the banks and force conventional banks to cut down their interest rates.
“There is nothing wrong with non-interest banking if its introduction is to enhance economic development and make business easier for customers since no interest is charged on loans,’’ he said.
Osarenkhoe said that the non-interest banking would promote entrepreneurship in the country since its concept was based on the principle of profit and loss sharing.
He advised the Central Bank of Nigeria (CBN) to create links in the Arab countries to facilitate the establishment of more of such banks as a way of diversifying the economy.
Mr Ayodeji Fagbenle, the General Manager, Cash Craft Assets Management Ltd., said that non-interest banking would enable banks to render more result-oriented services to customers.
He said that bank would encourage decision making on profitable businesses.
Fagbenle said that the new banking system would make it easier for manufacturers to source for loans to stimulate their production.
He, however, said that the CBN should not only be interested in introducing non-interest banking system , but should put in place appropriate infrastructure to monitor its implementation.
Mr Olumide Adegoke, the General Manager of Standard Alliance Insurance Ltd., said that the CBN needed to be careful in the implementation of non-interest banking to prevent religious crisis in the country.
He said that the non-interest banking had the capacity to galvanise small and medium enterprises and boost employment generation if properly implemented.
Adegoke also said that it would make conventional banks to be careful in charging interests on loans granted to customers.
“It is a good development for the economy because it will create more competition among the banks and boost the economy,’’ he said. (NAN)