LONDON, August 21, 2013 /PRNewswire/ --
Nigeria boasts Africa's fastest growing banking sector and is now looking to expand its reach to Islamic finance, provided it can negotiate the labyrinthine mass of regulatory initiatives. The country's Muslim population is close to 80 million, yet the Nigerian Islamic finance industry remains underdeveloped and ill-equipped to cater for demand, in large part due to exhaustive regulatory requirements.
Nigerian regulatory bodies have introduced a slew of new regulations over the past few months intended to transform the country into a hub for Islamic finance. However, regulations have rather impeded progress as the very limited range of products and services to date are offered by only two institutions.
The Islamic finance industry represents a huge opportunity for Nigeria, having spread to over 50 countries and worth an estimated $1trn annually, according to Moody's. Despite the industry's aversion to paying interest, there is room for the market to grow in Nigeria. Research by local group Efina suggests that nearly 35 percent of Nigerians not investing in non-interest banking projects would likely do so if given the opportunity.
"The potential is there but the market is negligible in Nigeria because we have only one Islamic bank and one window - but it has potential to grow", said Bashir Aliyu Umar, special adviser on non-interest banking to the Nigerian Central Bank governor. Provided Nigeria can adjust to regulatory restrictions, Islamic Finance offers an incredible opportunity for an already booming market to expand further still.
News of Nigeria's struggle for Islamic finance coincides with World Finance's prestigious Islamic Finance Awards, which offer an opportunity for the public to have their say on the industry's best Sharia compliant institutions worldwide.
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SOURCE World Finance