Iraq to Provide Islamic Banking Services

Iraq’s Ministry of Finance and Central Bank announced on Tuesday that Iraq will provide Islamic banking services in major banks owned by the state, under a plan worth $42 million which will be implemented this month.

The Finance Ministry said on its website that Islamic transactions will be facilitated in the Rafidain and Al-Rasheed banks over the next two weeks. Muther Qasim, a senior adviser at the CBI, reportedly told Reuters yesterday “it is good and there is a demand for it.”

Islamic banking prohibits the payment or acceptance of specific interest or fees (known as Riba or usury) for loans of money.

The two state banks dominate the banking sector in Iraq. Kassem said that the amount of $42 million will be divided between the two banks from the budget of 2011 for Islamic banking activities.

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