THE Leaders of thought drawn from Non-Interest Banks, Issuing Houses, Development Finance Institutions, Insurance Companies, and Law Firms, among others, have agreed to work together to deliver big-ticket Non-Interest Finance deals in the market. The decision was part of the key resolutions at the inaugural Non-Interest Finance Executive Forum hosted by the Sterling Alternative Finance Group in Lagos.
In his keynote address, Abubakar Suleiman, managing director, and chief executive officer, Sterling Bank, observed that despite the huge potential in the Non-Interest Banking, the economy has yet to tap into it to fund its huge infrastructural deficits. Suleiman, who was represented by Tunde Adeola, executive director, commercial banking of the bank, said since the advent of alternative finance in Nigeria, the Federal Government had only used it twice to raise Sukuk.
He added that only the Osun State Government has used the option to finance infrastructure among state governments to date. He said a lot of work still needed to be done through collaboration among players in the Non-Interest Finance industry to deepen the market to handle large ticket transactions. He noted that, from a marketing perspective, it would be better to push the Non-Interest Financing option as ethical funding in a bid to make it appealing to all customers.
Basheer Oshodi, Group Head, NIB, Sterling Alternative Finance, remarked that the market for alternative finance is still in its infancy and struggling to grow as expected, adding that there is a need for asset expansion, easy flow of liquidity and risk appetite alignment among players in the industry. He listed some of the contracts that could be used to finance asset classes in the Nigerian economy to include Musharaka and Mudarabah (equity-based); Wakala (service-based); Ijarah and Murabaha (debt-based).
– Feb. 14, 2020 @ 17:19 GMT |