Collaboration Between Industry and Academia, Key To Developing Islamic Finance In Nigeria

Collaboration Between Industry and Academia, Key To Developing Islamic Finance In Nigeria

Friday, July 31, 2020 / 1.00PM / Bukola Akinyele for WebTV / Header Image Credit: @UmarOseni

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Collaboration between Islamic finance practitioners and academia will be
vital to the development  of Islamic Finance Law in Nigeria. D
r. Umar Oseni, Chief Executive Officer and General Counsel, International
Islamic Liquidity Management Corporation (An Intergovernmental Financial
Institution headquartered in Kuala Lumpur, Malaysia) said this at a recent
webinar organized by stakeholders in the non-interest finance market.

 

He
noted that in every aspect of life, understanding concepts is very important.
In his explanation, he said aside having the understanding of the laws of
Islamic Finance, there is a need to know the roles lawyers play.

 

In
his presentation, he said western models dominate financial markets and that
conventional banking has existed for over 200 years, while the Islamic finance
re-emerged towards the end of the last century with Tabung Hajji, West African
Muslim Bank, and IsDB which was established in 1975  and this has brought
improvement in the Islamic finance industry.

 

Giving
historical details, Oseni said Prophet Mohammed (SAW)  succeeded in
pioneering an economic reform called “Culturation”  which was the
foundation of Islamic Finance.

 

The
IsDB, according to him, has contributed immensely to the growth and development
of the non-interest financial market across the globe, with related agencies
covering insurance and other segments of the industry.

 

Oseni
cited the example of Malaysia as a nation with a robust Islamic finance legal
system. He explained how the country introduced Islamic banking in 1983 and
established legal frameworks that covered the insurance industry and Islamic
finance services act.

 

At
the moment Malaysia is rated among the world’s leading destinations for the
advancement of Islamic Finance with regulations supporting the growth of the
ecosystem from investment banking to insurance.

 

He highlighted the following as challenges facing the development of
Islamic Finance Law in Nigeria;

  • When it comes to Islamic finance
    understanding litigation is very important.
  • Nigeria has few non-interest banks and
    this reflects a relatively  small market, which is a big challenge for
    lawyers specializing in Islamic finance
  • Dearth of experts in Islamic finance
  • Skepticism within the Muslim community
    which means some do not believe in Islamic finance
  • Religious sensitivities and NBA’s
    Institute for Continuing Legal Education – Islamic Finance Law.

The General Counsel of the ILMC also recommended a path for the
evolution of Islamic Finance which would include;

  • Developing a core team for thought
    leadership and innovative product development
  • Proactive engagement with Halal Firms to
    structure corporate Sukuk
  • Exploring the opportunities in the entire
    spectrum of Halal economy
  • Embracing the “New Normal” – Collaborating
    with Fintech startups
  • Enhancing Regional and global practice.
  • Collaborating with global firms

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