IFC invests €3.8 million in a Kenyan Islamic bank

Apr 16, 2013

The International Finance Corporation (IFC) has granted $5 million (€3.8 million) to the Gulf African Bank in Kenya, which represents the institution's first investment in a Sharia-compliant establishment in sub-Saharan Africa.

The International Finance Corporation (IFC) has granted $5 million (€3.8 million) to the Gulf African Bank in Kenya, which represents the institution's first investment in a Sharia-compliant establishment in sub-Saharan Africa.

The IFC will also provide a three million commercial credit line to Gulf African Bank as part of the "IFC Global Trade" programme, Jeune Afrique newspaper reports.

The funds will be used to strengthen the bank's financing of individuals and businesses, especially women entrepreneurs and small and medium-sized enterprises.

"In Kenya, new segments such as Islamic finance can strengthen competition and help create a greater number of small businesses and women entrepreneurs, often excluded from banking services," IFC Director for Eastern and Southern Africa Seydi Oumar said in a statement.

Kenya has a large Muslim community and the growing demand for Islamic finance is forcing financial institutions to evolve and adapt in order to take advantage of this market.

Since the introduction of Islamic finance in Kenya in 2008, two Islamic banks (providing only Sharia-compliant products) were created, and many commercial banks and insurance companies now offer Islamic finance and insurance products.ADNFCR-2976-ID-801571885-ADNFCR