A new Islamic bank named Summit Bank has just received provisional licensing from the Central Bank of Nigeria (CBN), bringing the total number of full-fledged Islamic banks in the country to six.
The full-fledged Islamic banks, duly licensed by the CBN are: Jaiz Bank Plc; Taj Bank Limited; Lotus Bank Limited;Sun Trust Bank Limited; Alternative Bank Plc and Summit Bank Limited.
Meanwhile, Nigeria’s first non-interest Islamic financial institution, Jaiz Bank Plc recently unfolded plans to meet the new recapitalisation requirement set by the CBN, charging that it’s on course to becoming the first bank to cross the huddle.
This was disclosed by Managing Director/CEO, Dr. Haruna Musa at the 12th Annual General Meeting (AGM) of the bank held in Abuja.
Jaiz Bank and other non-interest banks hoping to achieve national status have till March 31, 2026 to record a N20 billion capital base as directed by the Central Bank of Nigeria under its ongoing banking system recapitalisation.
Also, he informed that henceforth, shareholders of the bank will be smiling home with not less than N1 dividend, assuring them of better performance in the years ahead.
Similarly, ‘The Alternative’ Bank’s adventure started with a grand idea in January 2014, when it was provisionally allowed to offer a non-interest banking window under Sterling Bank.
At the heart of its journey is ACE -an Advisory Committee of Experts, who ensure every step is in harmony with the ethics of Non-Interest Banking (NIB).
Non-Interest Banking, where Interest Rates play no role, is a banking system which is governed by a resilient code of ethics in all its practices and functions.
It is the first, where a customer, whether an individual or business, is not just a customer but is a partner with the Bank or owner of goods and assets.
This means they share the risks as well as the profits of such a partnership and ownership. This unique arrangement is done under the principles of Shariah (Islamic Law) which always ensures complete transparency
Since the beginning of the 18th century, banking has been conducted on an interest-based system of lending money to those in need. With no other alternative available, people had no choice but to borrow money at often high interest rates. This led to the formation of an unfair system that brought unnecessary hardship on people.
It was this need for a fair financial system that brought about the birth of Non-Interest Banking in the mid-1970s. Its objective was to provide a financial alternative that was fair, transparent and above all, a source of economic upliftment for all those in need.
Non-Interest Banking, emerged as a response to both religious and economic exigencies. It is an alternative financial system, operating within a framework that adheres to the tenet-based principles of Shariah (Islamic Law), thereby introducing a fair system of social justice and equality, while fulfilling the financial needs of people and maintaining high standards of ethics, transparency and a sense of responsibility.
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