Mauritania introduces a new reforms "specific" to Islamic Finance

Apr 18, 2012

The governor of the Central Bank of Mauritania (BCM) Sid’Ahmed Ould Rais has announced the introduction of reforms to provide "a new legal and regulatory frame that is specific to Islamic finance products", PANA news agency reports.

The governor of the Central Bank of Mauritania (BCM) Sid’Ahmed Ould Rais has announced the introduction of reforms to provide "a new legal and regulatory frame that is specific to Islamic finance products", PANA news agency reports.

He made this statement during a forum on Islamic finance, which started on Sunday (April 15th)
in Nouakchott under the theme Islamic finance and the development of small and medium enterprises in Mauritania and the Maghreb region.

The governor told PANA news agency that all Mauritanian banks have special counters dedicated to Islamic finance but that they operate on a legal base originating from the classic banking system.

He believes this situation "hampers the widening of access to banking services in Mauritania, as the Muslim mentality is resistant to speculation".

The Islamic finance sector is currently worth around $1 billion (€766.5 million) and should reach $1.8 billion in 2016, according to figures from the African Development Bank (AfDB).

However, in North Africa, this type of finance remains underdeveloped, mainly because of low awareness from potential clients, the limited development of retail banking activities and the lack of support from the governments, according to a report from the organisation called Islamic Banking and Finance in North Africa.

Only 24 Islamic finance projects have so far been approved in North Africa, for a total amount of $2.4 billion.

The institution therefore believes there is room for more Islamic banking services in North Africa and that they could contribute a more inclusive development model that favours an equal sharing of risks and benefits between project providers and resource users.

This financing method is also considered as a viable solution to improve access to banking services in Mauritania, where only 150,000 people own a bank account in a population of three million, according to figures from the BCM.ADNFCR-2976-ID-801342802-ADNFCR