The World Bank says eight in 10 Muslims do not use conventional banking systems — a practice that emphasises the need for Islamic Banks.
Speaking at the World Bank Headquarters in Washington, Arunma Oteh, vice president and treasurer of the Bank, said growing products in Islamic finances are capable of closing the huge financial gap that exists in the Muslim world.
Discussing Islamic finance at the World Bank/Islamic Financial Services Board high level seminar, Oteh said less than 20 percent of approximately 1.6 billion Muslims population use conventional banking worldwide.
“The growth of Islamic finance is critical in closing this gap,” she said, adding that the statistic is scary.
“In some cases, people will like to access financial services but they are unable to do so because of factors that are prohibitive to their faith or lack of financial institutions near their area or lack of trust of financial service providers
“Many Muslims around the world refrain from actively accessing the conventional financial services around the world due to their beliefs.
“Islamic finance is uniquely well-suited to promote infrastructure development, which is critical in promoting many of the SDGs from clean water to energy.”
Muhammad Sanusi II, the Emir of Kano, who also spoke at the event, said deficient infrastructure cost in Africa shaves the continent’s growth by two percent annually.
He estimated the cost of closing this infrastructure gap estimated at $360billion between 2011 to 2014.
According to Sanusi Islamic finance facilities can be used in funding various social projects such as immunization projects, education and green energy.
He said with the growing Islamic finance, there is strong potential in closing the huge gap and there is no doubt that the need to explore all alternative in funding the SDGs is critical.