Digitization of Islamic finance in Algeria

Tehran (IQNA) – Islamic finance is gaining momentum in Algeria, but it has not yet reached cruising speed. However, operators are starting out by offering a diverse range of products with the added bonus of digitizing operations.

Nacer Hideur, CEO of Al Salam Bank Algeria, confirmed the trend while speaking at the Algiers Islamic Finance Forum in Algiers on Wednesday. According to him, in order to adapt to the evolution of the world, it is necessary to move to offer more digital solutions in transactions, so that it is not always necessary to have a bank branch to offer its products when doing it remotely. “We think we will do it through digital banking services like e-payment, digital credit, A-banking, M-banking, M-payment,” he said.

He also noted the electronic signing of financial contracts aimed at reducing the administrative burden on employees and facilitating transactions with remote clients, reducing the margin of error, especially the risk of non-compliance with Sharia. and finally, increasing the commercial and marketing efficiency of the products.

“In Algeria, Islamic finance has demonstrated its very significant social impact. We noted the enthusiasm among the citizens. Some time ago, people hesitated to use banking services due to psychological factors and the interest rate problem. The official believes that with the integration of Islamic finance into the strategies of state banks, which account for 87% of the market share, they will gain more market share. To achieve this, he emphasized the importance of multiplying players and expanding the operational network. Just as he insists on promoting the banking culture by emphasizing the advantages of banking and savings.

Touching on Islamic finance and financial inclusion, Nacer Hideur pointed out that Islamic finance enables fair and equitable distribution of income and wealth. “It has a lot to do with the real economy. It is based on risk sharing. This funding formula can contribute to improving the stability of the financial sector. It can attract those who are currently excluded for cultural or religious reasons into the formal financial system.

Prospective market
Sofiane Mazari, head of Islamic finance at Crédit Populaire d’Algérie (CPA), noted that her institution has chosen to address individuals first, then professionals and soon companies. He said that CPA has created an online sales platform where financial products are offered for the purchase of household appliances for individuals and professionals. He informed that the CPA has established a Shariah oversight committee consisting of leading experts in Islamic Shariah who have great expertise in Islamic, economic, legal and banking sciences. He noted that Algerians are very demanding and the market is promising. As a proof of this, he showed that 16 billion dinars have been accumulated, dedicated to Islamic finance, mainly savings products. He also announced that more than 26,000 customers have opened accounts in the state bank based on Sharia principles.

Samir Rezak, director of Islamic finance at ABC Bank Algeria, does not hide the bank’s ambition. “We want to provide quality services provided by a team of professionals specially prepared and trained for this purpose through our products that meet the rulings of Islamic Sharia,” he said, defending the best presentation of products on the market. be competitive in terms of prices and services.

Zoubir Ben Terdeyet, director of Isla-Invest, organizer of the event, believes that Islamic finance is now part of the DNA of the banking landscape of countries that ban it. According to him, one more step should be taken, innovation and the launch of new modern and innovative banking services. He considered it right to involve the diaspora in this work.

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