Bangladesh Bank (BB) will introduce Shariah-based refinancing scheme for Small and Medium Enterprises (SMEs) and other thrust sectors, Governor Dr Atiur Rahman told a seminar on Sunday, reports BSS.
Referring to the Shariah compliant mode of refinance support from BB’s Export Development Fund (EDF), the governor said introduction of similar Shariah compliant refinance support against SMEs and other thrust sector lending by Islamic banks is also underway. Dr Atiur was addressing the seminar on “Shariah Banking: Bangladesh Perspective”, organised by Islamic Banks Consultative Forum (IBCF) at a city hotel.
State Minister for Finance MA Mannan, and Islami Development Bank (IDB) President Dr Ahmad Mohammed Ali also addressed the seminar.
Eminent Islamic banking expert Azizul Huq presented the keynote paper on Shariah-based Islamic banking, signifying the growing role of Islamic banking in socially responsible financing of trade and output activities in the country’s economy, including underserved and un-served sectors like agriculture and Micro, Small and Medium Enterprises (MSMEs).
Speaking on the subject, the governor said Shariah-based Islamic banking already constitutes about a fifth of the country’s banking sector.
As mentioned in the keynote paper, Dr Atiur said BB acted early on towards introduction of a government Islamic investment bond of six-month tenor to facilitate liquidity management of Islamic banks; introduction of 
another similar instrument of three-month tenor for further facilitation is at the final stage.
He said the central bank already issued guidelines for Islamic banking in Bangladesh using an approach that delegates to the Shariah-based financing community the self-regulation and oversight of its Shariah compliance practices.
“This has served well in providing a level playing field for Shariah-based financing alongside the conventional options,” Dr Atiur said.
He hoped to see more of Islamic financing in the participatory risk sharing “Musharaka” and “Murabaha” financing modes, particularly for MSMEs and “green” or environmentally benign ventures, rather than in the non-participatory “Mudaraba” and “Ijarah” modes.