The Central Bank and Islamic banking plans

The Central Bank of Libya is continuing to work on plans for the introduction of Sharia-compliant banking within the Libyan financial sector.

A consultant engaged on the project at the bank, Fatih Aqoub, has been reported as saying that rapid progress has been made, since a special committee began work this January.  The committee had been seeking best practice from elsewhere in the Islamic world . It was formulating amendments to the banking laws that would enable Sharia banking for an interim period before separate legislation was enacted.

Aqoub also reportedly said that Libyan banks were working hard to produce Sharia products ahead of being licensed to trade them. Confusingly, however, stories in the Arabic language papers then quoted him as saying that some banks were already providing Sharia banking from the Islamic banking branches.

Last month, Libya Herald reported that some employees from Sahara Bank in Benghazi had held a demonstration  outside their workplace, to protest against its use of interest. They demanded that it start using Sharia-compliant banking.

At the time, the governor of the Central Bank, Saddek Elkaber, said that he believed that demand for Sharia-compliant banking was so high, that it might become an important part of Libyan banking.  Speaking at an Arab banking conference in Kuwait in August, he said that specific rules governing Islamic banking in Libya would probably be implemented by the end of the year

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