IslamicFinance.de

The International Monetary Fund (IMF) has warned that the rapid growth of Islamic finance in Kenya is happening without adequate protection of depositors. Despite the fact that the Shariah banks are already offering loan products, Kenya is yet to refine its prudential regulations to cater for Islamic banking. Kenya is also yet to come up with a Shariah-compliant deposit insurance scheme and is continuing to manage deposit insurance premiums in a single pool for all banks. This situation could complicate compensation of depositors if a bank offering conventional and Islamic products collapses. According to the IMF, Kenya should seek to bring clarity to the grey areas in Islamic finance as it drafts amendments to the banking law as promised in the 2017/18 budget.