Uganda will start licensing financial institutions, which want to offer Islamic banking products, a senior official with the country’s central bank said.
“We will be licensing financial institutions that want to offer Islamic banking products. A few were awaiting enactment of the law,” The Monitor newspaper reported, quoting Adam Mugume, Bank of Uganda director for research.
President Yoweri Museveni has recently signed the Financial Institutions (Amendment) Act, 2023, which effectively authorises Islamic banking in the country.
The legal roadblocks, which included a definition of interest, insurance and reinsurance of loans, have now been cleared, which opens up the financial sector to Islamic banking, the newspaper stated.
Last month, the Saudi Central Bank Governor and Chairman of the Islamic Financial Services Board’s Council said that the global Islamic finance sector has witnessed accelerated growth, with the value of its assets standing at over SAR 11.2 trillion, rising 9.6% over the last three years.
He noted that Saudi Arabia is the largest sovereign sukuk issuer in the world and its cooperative insurance sector is the fastest growing worldwide, with a growth rate approaching 27% in 2022.—Zawya News
