• Anyone who is engaged in sheriah non-compliant business such as alcohol, arms weapons and tobacco trade,• The interest to income o ratio of the company exceeding 5%,• Applicants engaged in producing, packaging and processing of pork and its products, and• Financial institutions dealing with interest
Who is illegible to get IFB Finance?
• Anyone who have IFB deposit account (Saving or Current) in any of BOA Branch, and whose account turnover is satisfactory.• Anyone who is engaged in lawful and credit worthy business.• For consumer Financing: – who have defined and sustainable source of income.• Anyone who is viable as per the bank’s IFB financing procedure manual.
Is conventional insurance allowed in IFB?
Insurance is NOT allowed in Islam, due to shari’a compliances. However, since insurances are not available in our country; conventional insurances are providing the service.
How do Interest-Free banks reward their depositors since payment of interest is prohibited?
In Shariah, there are many ways to share profit or returns between a bank and its customers. For example, in a deposit product, profits from a deposit arrangement will be shared between a bank and its depositors based on an agreed ratio and paid as dividends. Shariah also allows a bank to give hibah (gift) to its depositors as it deems fit. Through Mudarabah i.e As per the pre-determined agreed profit sharing ratio (between the Bank and depositor)
Is cash collected from IFB physically segregated from the conventional?
Money is not treated as a commodity though it is used as a medium of exchange and store of value. And also money has no religion. The owner of money is God. So physical segregation is not the concern of shariah instead all collections and payments to and from this service should be recorded and reported separately.
Is Interest-Free Banking Service only for Muslims?
No, it can apply to the Non-Muslim religion applicants too ፡ individuals or business entities whose source of fund is Shariah-compliant are allowed to use interest-free banking service.
Who are BOA Shari’ah Advisory Board Members
• Sheik Nuredin DelilVice chairman of board of directors at Federal supreme Islamic affair and chairman of BOA Sharia’h Board• Ustaz Mohammed AbateVice Chairman of board of directors of Addis Ababa Islamic Affair and BOA Sharia’h Board member
What is a Shari’ah Board?
Shari’ah board comprises Islamic scholars who are experts in Islamic jurisprudence. Shari’ah board has the task of ensuring compliance to Islamic principles in products offered by Islamic Financial Institutions (IFIs).
What are Shari’ah prohibited activities
• Prohibition of unfairness and injustice• Prohibition of Riba (usury)• Prohibition of Gharar (Deception and Speculation)• Prohibition of Gambling• Prohibition of money trading (many is not a commodity rather it is a medium)• Prohibition of dealing in unlawful and unethical goods and services