News Category: Capital Market
Register Date: Aug 26 2017
Publish Date: Aug 26 2017

CBI to Revise Islamic Banking Law

Tehran, Aug. 21 (SENA) - It’s been two years now that the Central Bank of Iran and the parliamentary economic committee have been working to revise the country’s Islamic banking law, a member of the CBI’s Fiqh Council revealed this week.

Tehran, Aug. 21 (SENA) - It’s been two years now that the Central Bank of Iran and the parliamentary economic committee have been working to revise the country’s Islamic banking law, a member of the CBI’s Fiqh Council revealed this week.

Abbas Mousavian admitted that the current banking law already has problems, but he added the new law would address the problems.

Addressing a gathering of Shiite and Sunni clerics in Sanandaj, Kurdistan, Mousavian said the Central Bank is determined to amend the Islamic banking law and get banks employees and the public more familiar with Islamic banking advantages.

“The revised law will educate both customers and banks employees with the advantages of the Islamic banking contracts, especially when it comes to the credits,” he said.

Mousavian blamed the Iran-Iraq war, external economic pressures and galloping inflation for the failure of the Islamic banking system in the past few decades.

He noted that the Central Bank is now seeking to use morabaha, an Islamic contract, as the main banking contract across the country under the revised law.

Murabaha is an Islamic financing structure in which an intermediary buys a property with free and clear title. It is not an interest-bearing loan, which is considered usury. It is an acceptable form of credit sale under Sharia of the Islamic law.

“Murabaha will help speed up deals between banks and customers,” the official said, adding that the Islamic contract is supported by both the Iranian Sunni and Shiite clerics.

Mousavian expressed hope that the proposal prepared by the economic committee will soon be approved on the floor.


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