LAHORE - Poverty, income inequality, regional disparity and illiteracy are four key problems, hindering Pakistan’s economic growth and Islamic banking can play a key role to address these challenges,” said Dr Ishrat Hussain, advisor to PM on Institutional Reforms and Austerity. He was the keynote speaker at the 3rd International Conference on Islamic Banking and Finance at the Institute of Business Management (IoBM) Karachi. The two-day conference invited speakers from the USA, Australia, Saudi Arabia, Bahrain, Malaysia and Qatar.
Dr Ishrat proposed that Islamic Banking can contribute heavily to poverty alleviation, low cost housing, micro-finance, financial inclusion and educational outreach. “Those who do not believe in financial inclusion because of faith can reach through Islamic Banking,” he added. He highlighted that non performing loans are one of the biggest challenges to the banking industry, adding that Islamic banking, being shariah compliant, can assess the risk way better than conventional banking. He said that using the same strength, Ismalic Banking is more suitable to fund startups which are otherwise avoided by conventional banks.
“Government is investing in the knowledge economy to develop human capital,” he said while adding that there is a need to help young entrepreneurs, provide education to rural women and promote the program-lending business model. He stressed the use of Ijara in agricultural financing and to educate poor students from backward areas.
“Prime Minister is very keen on providing low cost affordable housing to people and Islamic banking can play a pivotal role in it. Fintech and artificial intelligence can develop credit scoring models to facilitate it.
Talib S Karim, President IoBM, congratulated the organizing committee on holding 3rd successful ICIBF. He expressed the need to establish a Centre of Islamic Banking to explore the potential of this sector in Pakistan. Bashir Janmohammed, Chancellor IoBM, said that individuals and institutions must facilitate economic growth. He advised students to create jobs by launching startups.