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Roadmap for Islamic banking in Russia will be developed by autumn

August 06, 2015, 17:17 UTC+3 MOSCOW
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MOSCOW, August 6. /TASS/. Russian lawmakers will prepare a roadmap for the introduction of financial instruments of Islamic Banking in Russia by autumn, Dmitry Savelyev, Deputy Chairman of the State Duma (Russian parliament's lower house) committee on financial markets told TASS.

He said that the State Duma’s working group on amendments to the law on banks and banking activities has begun working on the roadmap.

"My legislative task to allow banks to conduct commercial activities /which is prohibited by the current legislation - TASS/ has found support but according to all the parties involved it requires specification. No one doubts that the legal base for the introduction of Islamic banking should be examined in detail - this will create a new level of relations between our financial market and investors from Muslim countries. Everybody understands that it is slow and steady who wins the race," - the lawmaker said.

According to him inevitable difficulties with the introduction of an alternative banking can be overcome, when it comes to the inflow of additional investments to the country.

"We should not ignore alternative principles of banking business. We see positive functioning of such system not only in Muslim countries but also a positive example of the bank of Vatican. Working on a draft law we will take into consideration specific of banking requirements of all confessions," - Savelyev said.

On July 14, 2015, head of Russia’s largest saving bank Sberbank German Gref and acting governor of Russia’s Tatarstan republic Rustam Minikhanov signed an agreement on cooperation to provide Islamic banking services in the republic.

The operations of Islamic banks are marked by the absence of interest rates on deposits and loans. The transactions they service are necessarily expected to have real collateral guarantees.

Islamic banks and financial institutions cannot finance arms trade, production and/or circulation of liquors, tobacco or pork, or gambling establishments.

Beginning with the 1990’s, Islamic banks have been developing in the Middle East, Southeast Asia, and several European countries.

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