AMU to launch Islamic banking

The Aligarh Muslim University (AMU) will shortly start a course on Islamic Banking and Finance that will be based on the norms of Shariah (Islamic rules on transaction). This is the first time that such a course that allows “interest free banking” is being started in India.

The Islamic law prohibits interest on both loans and deposits, as both profit and risk are shared together by the borrower and the lender.

As a result, the depositor, who does not bear risk in other banking systems has to equally share the risk with the bank in Islamic banking. Owner of the capital, however, is allowed to have a share in the surplus.

India has no banks that operate on shirkah and muzarabah that are the basic Islamic principles. The Daurl Ifta Deoband has even issued a fatwa against “normal and routine” banking schemes that do not subscribe to Islamic norms.

There are, meanwhile, a few non-banking cooperatives like Al Ameen Islamic Financial and Investment Corporation Ltd. in Karnataka and Mumbai-based Al-Barr Finance House Limited, which have branches in some cities, including Aligarh. There are also some popular investment companies that claim to invest money as per the Islamic laws.

A three-member committee has been set up under the chairmanship of Dr Mohammed Nejatullah Siddiqi, a retired Aligarh Muslim University, professor of economics and Islamic studies to work out the modalities of the course on Islamic banking.

HDFC Bank ties up with ngpay

HDFC Bank on Tuesday launched fund transfer on ngpay, India’s leading mobile commerce network. With this launch, HDFC Bank has become the first bank in India to offer, on one single platform, a suite of banking and commerce services over the mobile, including accessing bank accounts, shopping, ticketing and payments.

Mr Rahul Bhagat, country head, retail liabilities, marketing and direct banking channels, HDFC Bank, said “There are around 270 million mobile phone sub scribers in India, and the number is growing with 8 million new subscribers being added every month.” HDFC Bank was the first to offer online net banking services back in 1999 and mobile banking to its customers in January 2000.

“With ngpay, users can complete transactions with retailers, banks, and service providers on their mobile. It is free for users, has certified financial grade security,” said Sourabh Jain, CEO, ngpay. So, if you want to buy anything, sms ‘ngpay’ to 56767 and download an application and register with ngpay.