Algeria plans to launch Islamic finance, says BFIA

Jun 17, 2016

The government is looking to diversify its economy away from oil and gas.

Algeria is preparing to launch Islamic financial services, a senior financial official told Reuters.

Boualem Djebbar, head of the Banks and Financial Institutions Association (BFIA), said the government is looking to modernise its financial sector and diversify its economy away from oil and gas after a sharp fall in energy revenues.

The sector currently accounts for 60 percent of the state budget and 95 percent of the country's revenue from exports.

Mr Djebbar did not give many details, but said that a legal framework must first be finalised and that a commission has been set up to speed up the process.

Despite the importance of the Muslim population in Algeria, only a small percentage of financial transactions are currently carried out in accordance with the Sharia.

According to statistics published by American poll company Gallup in December 2014, only three percent of Algerians would opt for Islamic finance products rather than more traditional means.

However, the survey shows that nearly half of respondents said they knew about Islamic finance and 49 percent were willing or eager to try these types of banking services.ADNFCR-2976-ID-801820363-ADNFCR