A financial analyst and lecturer at the Cape Coast University, John Gatsi has suggested that the Bank of Ghana should consider introducing Islamic Banking just like in Nigeria.
Statistics also show that while the world faced severe economic crisis, Islamic banks across the world continue to grow.
Under Islamic banking, a borrower only needs to pay back the amount owed to the bank, and the borrower can also choose to pay the lender a small amount of money to serve as a gratuity.
Sharing his thoughts on the subject with Citi Business News, John Gatsi opined that “interest rates are high and cost of doing business is also high and the cost of borrowing is not the best hence the call for the introduction of Islamic banking where there will be no interests.”
According to him, people are calling for the introduction of Islamic banking in Ghana as an alternative. Mr. Gasti however noted that there are a lot of limitations and hindrances which may affect the introduction of this kind of banking because “you cannot introduce a new banking system into the conventional system without allowing the Central Bank to lenience the operations of such businesses. So as at the now, the Central Bank is not having any discussions with respect to Islamic banking.”
He also told Citi Business News, there are advantages for financial intermediation when Islamic banking is introduced.
“If you look at what the Muslims tell us, it means that without the presence of Islamic banking in the country, savings mobilization is hugely affected because there are a lot of Muslims based on their faith who do not have any dealings with the banking system even though they engage in productive economic activities”, Mr. Gatsi said.
He further stated that the lack of Islamic banking in Ghana is affecting financial intermediation and so “with the introduction of Islamic banking, I am sure that financial intermediation will be improved and savings mobilization will be enhanced in the country.”
Mr. John Gatsi however urged the Muslim community in Ghana to set the tone for this discussion although they are doing a lot of underground work “but they need to bring the discussion to the national level.”