Imams Tasked With Retrieving $90 Billion Dollars From The Sprawling Black Market

The Supreme Islamic Council embarked on an awareness-raising campaign to persuade businessmen and economic operators to pump their accumulated funds outside official channels, which amount to nearly $90 billion dollars, into banks according to Islamic banking formulas, given that the suspicion of usury is behind the reluctance of a large number of Algerians to opt for bank deposits.
This comes at a time when 6 public banks launched services and products that comply with Islamic law or Sharia, the latest of which is the Algerian External Bank, two weeks ago, and the Local Development Bank, which on Monday began circulating 9 products for Islamic banking in its agencies, with the goal of collecting savings ranging between 500 and 800 billion centimes at the end of the year and generalizing Islamic banking through at least 50 agencies, according to the general manager of the bank, Youcef Lamas.
The latter revealed, during a press conference held on Monday, following the inauguration of an Islamic bank account for the first client at the Staoueli agency in the capital’s western suburbs, that the bank will play the role of a mediator to retrieve dormant funds on the black market through various Islamic banking services, which include Murabaha products, savings and rent-to-own in order to finance projects and acquisitions notably real estate, apartments and cars destined for individuals, professionals or machines, stressing that the bank will work diligently to spread these services across all provinces of the country, and in a first stage reach 50 agencies by the end of this year with expected ranging savings between 500 and 800 billion centimes.
Regarding the delay in launching Islamic banking, he attributed this to the bank’s delay despite the readiness of the products due to the Coronavirus pandemic, but he stressed that the profit margin at the “Local Development Bank” will be lower compared to other banks, as a result of not calculating some commissions, adding in a response to the journalists’ questions, “we focused on the need to reduce prices, so that they are not high and contrary to what our customers desire,” adding, “The more Islamic banking is spread through a larger number of banks, the greater the competition, and the lower the prices.”
According to the director of the Local Development Bank, his institution seeks in the future to reach a higher level of universal Islamic financial services, through the dissemination of Islamic “sukuks” or shares.
He also stated that the bank proposes its Sharia-compliant services for young entrepreneurs and businessmen, according to special offers and unprecedented incentives.
For his part, the head of the Supreme Islamic Council, Bouabdallah Ghoulam Allah, revealed that he recently organized meetings with economic dealers and businessmen to convince them of Shariah-compliant financial transactions in banks, stressing, “We are certain that these transactions are Sharia-compliant, for here in Islamic windows in banks there is halal livelihood.”
Mr. Ghoulamullah said that the Algerian economy today is in the hands of private dealers and factory owners, but they are required to take out their savings from the “shokara” or “big bag”, and put them in Islamic accounts, as this is safer for them, and the best service to the national economy, which is the same as what a member of the National Legitimate Body for Fatwas on Industry said.
On the other hand, a member of the Fatwa and Financial Industry Commission of the Supreme Islamic Council, Professor Mohamed Boudjalal, emphasized that the reason for the high prices of Islamic services in banks is due to some fees, such as those imposed by the Tax Directorate when financing a home purchase, for example, and related to real estate Murabaha or rent through ownership.
The “Local Development Bank” products that bore the name “Al Badil” are represented in “real estate lease ending with ownership” for individuals, “cars Murabaha” for individuals, “consumption Murabaha” for individuals, “investment Murabaha” for institutions, as well as “exploitation Murabaha” for institutions, and “the accounts;” including Islamic Current Account, Islamic Check Account, Savings Account, and Mudaraba Investment Account Deposits.