NAB to introduce Muslim-friendly loans (1 Viewer)

[chicky_pie]

ONE of Australia's major banks is planning to introduce "Muslim-friendly" loans that do not charge interest, to comply with Sharia law.

Instead, the National Australia Bank will structure an Islam-approved line of finance to make money from alternative methods.

These include profit-sharing on the transaction, joint-ventures or leasing-type arrangements.

For example, to get round the Islamic ban on usury - or unfair lending - a Muslim mortgage often works by the bank buying the property, then selling it to the customer at a profit, with the customer then repaying the entire sum in instalments.

In this way the profit margin is built in from the start. It also has the advantage of making the loan immune from future interest rate rises.

NAB said the loans, which will start out small, will have to be cleared by a Sharia Advisory Board to ensure they meet strict criteria before they can be made available to the public.

"We are dipping our toe in the water with this scheme and thought we may be able to offer this product in high-density Muslim areas," said Richard Peters, head of community finance and development at NAB.

"We suspect there is demand out there, but we don't know how big it is, so we will trial a few products first."

For the trial's purposes NAB will pump $15 million from its not-for-profit finance division into the program, which will distribute the funds through various community finance schemes around the country.

The bank will monitor the take-up and assess potential demand.

Interest-free loans of up to $1000 will be available to help finance household items, such as washing machines and fridges.

The loans would also be available to non-Muslims.

The news comes just days after federal Assistant Treasurer Chris Bowen said that Australia could exploit international demand for Islamic finance to create more jobs.


NAB to introduce Muslim-friendly loans | Money | News.com.au

damn you religion

 

[SAVAK]

don't understand the issue here. If there is demand in the market let it be. Of course, I have very little understanding of Islamic banking however I do know anything remotely related to interests is un Islamic.

 

[S.H.O.D.A.N.]

Oh for fuck's sake, what part of the word 'secular' don't they understand?

 

[MaNiElla]

Oh for fuck's sake, what part of the word 'secular' don't they understand?

What issues do you have against such a scheme?

Its not going to affect you or the rest of the community.

 

[SAVAK]

I seriously dont understand the issue here.

 

[sam04u]

The Islams 'R Coming!

 

[S.H.O.D.A.N.]

What issues do you have against such a scheme?

Its not going to affect you or the rest of the community.

I would be just as pissed off if this were some Hindu or Christian scheme. Religion has absolutely no place in banking.

 

[JonathanM]

I see nothing wrong with the actual process, looks fine to me.

What worries me is that I do not want Sharia Law to become manifest in Australia - it can piss off. First this, then something else, then people will be asking for separate religious Sharia courts (there are already lobby groups requesting this). We're all equal, we should all go to the same civil/criminal courts. :mad1:

 

[Sprangler]

For example, to get round the Islamic ban on usury - or unfair lending - a Muslim mortgage often works by the bank buying the property, then selling it to the customer at a profit, with the customer then repaying the entire sum in instalments.

In this way the profit margin is built in from the start. It also has the advantage of making the loan immune from future interest rate rises.

Surely they can implement this system without labeling it "Muslim loans", and leaving Islam entirely out of it?

 

[S.H.O.D.A.N.]

Surely they can implement this system without labeling it "Muslim loans", and leaving Islam entirely out of it?

Good point.

Will you only be allowed to apply if you're a Muslim? Because that would be fucked up. And seemingly illegal.

 

[shinji]

Good point.

Will you only be allowed to apply if you're a Muslim? Because that would be fucked up. And seemingly illegal.

read the article

Will be availanble for non-muslims.


but still - wth does religion have anything to do with finance? As shown before, religion & science never worked out. Now this.. ==

 

[banco55]

It seems like they just use a less efficient way for the lender to make a profit so they can plausibly say they are interest free loans.

 

[Cookie182]

No issue really.

There's an active market, there is demand and now there will be supply.

If it raises one of Australia's largest banks profits in a time of crisis, then it can only be a good thing.

 

[Riet]

Its not so different from a fixed interest rate loan tbh.

 

[rara92]

I would be just as pissed off if this were some Hindu or Christian scheme. Religion has absolutely no place in banking.

religion does have a place in banking. because islam encompasses all aspect of life and if it applies to muslims and non muslims, and doesnt effect you personally i dnt see the need to make such a big deal out of it. Oh wait its because it involves muslims and society these days enjoys making a big fuss about anything that involves muslims. how about you just get over it!!!</SPAN>

 

[Nahidul]

Wow, this seems like a good idea, but since media and other things blow things out of proportion (eg swine flu), these type of loans should not be named 'Muslim' loans, rather something like 'interest-free loans'. As soon as you guys heard 'muslim' loans you were immediately aggravated. But, with a name like 'interest free' loan, I'm sure their wouldnt be this much of a dispute for this issue.

 

[SylviaB]

religion does have a place in banking. because islam encompasses all aspect of life

Australia is a secular society.

 

[rara92]

Australia is a secular society.

yes i get that. But just like australia builds mosques, churches, temples, has christmas and easter holidays, its allowed to meet the needs of other religions. and if you read the article its not just for muslims, but it just means its opening its doors to muslims who may have had an issue with the old system as well as non muslims who want to benifit from this system.

 

[SAVAK]

So let me get the right; If I want to purchase a $1000 fridge the bank will buy it for me. BUT, they will sell it back to for......$2000. If the loan is over a 1 year period ill be paying $2000/52 = $39.00 pw in repayments?

I dont understand how this is soooooooooooooo much differnt from what we already have.

 

[x.christina]

pork free?