Agricultural Credit Bank Launches Islamic Retail Banking Products

The Principal Bank for Development and Agricultural Credit targets to expand in Sharia-compliant retail banking this month through offering a number of products, most notably durable goods financing product.

Sources said the bank plans to deal with a number of companies to buy the tools needed by customers, and then sell these tools to customers.

The bank also plans to launch financing programs to customers to pay school fees, finish apartments and purchase tools and machines. The bank will offer Sharia-compliant mortgage products and expand in offering car Murabaha, sources added.

The bank will negotiate with the Ministry of Agriculture to allocate for the bank land lots with area ranging from 5,000 feddans to 10,000 feddans to establish agricultural projects such as productive villages that will provide all agricultural products and crops in new cities.

The political turbulence in Egypt has led to halting the negotiations, but they are expected to be renewed soon. The bank has set different scenarios for the project which are: buying lands and selling them to farmers under Murabaha scheme, contracting with a company to reclaim the land and buying it from the company to be sold afterwards to farmers, and entering into partnership with farmers under Musharaka scheme. The project aims at providing job opportunities to farmers.

The bank negotiates with the Ministry to receive land with the required facilities and services. The bank has not decided the investment cost of the project yet, as it will be determined according to the nature of the lands.

The bank’s Islamic banking unit deals with more than 70,000 customers mainly in Qena and Tanta and its branch in Tahrir deals with more than 5,000 customers.