IslamicFinance.de

Russia's state-controlled Sberbank will acquire 25% of the PayZakat platform that collects charity for Muslims in need. PayZakat is a start-up that won Sberbank’s first Sber#Up corporate accelerator competition for its own employees, and the bank sees global and universal potential for the platform. The PayZakat platform allows its users to calculate their contribution amount, and channel it to the charity of their choice. Chat bots integrated into social networks help with the process and provide status updates on the contribution. Sberbank is at the forefront of Russian digital development and is preparing to launch its Sber digital ecosystem in the short- to medium-term.

Russian lawmakers have introduced to parliament a draft bill to support Islamic finance, aiming to attract capital inflows at a time when an economic slowdown is intensifying and Western sanctions show no sign of being lifted. The draft law, sent to parliament's lower house, the State Duma, this week, proposes allowing banks to engage in trade activities, a concept central to many of the structures used in sharia-compliant financial products. While many other obstacles remain, the bill is seen a first step to spur development of the sector. The draft law must pass three readings in the Duma before it moves to the upper house and then to President Vladimir Putin's desk to be signed into law.

Russian banks are developing their expertise in Islamic finance to help broaden funding sources for local firms, though Western sanctions over the Ukraine crisis could hinder those efforts. Banks in the Middle East and southeast Asia, the major markets for sharia-compliant debt, are wary of becoming tangled in the EU sanctions. So some Russian lenders are trying to build their own in-house knowledge of Islamic finance. State development bank Vnesheconombank (VEB) is seeking help from Middle East firms to develop its Islamic finance expertise. VTB Bank is exploring sukuk deals for several of its clients. However, the lack of a Russian regulatory framework for Islamic finance is an obstacle.