​Interest free banking in Russia eases sanctions

Interest free banking is on the rise and is seen as a way out to ease the effect of sanctions in Russia

​Interest free banking in Russia eases sanctions

World Bulletin / News Desk

Head of Russia’s largest bank Sberbank, Herman Gref has welcomed the introduction of interest free banking in the country’s traditionally Muslim regions, saying it would help attract capital from Arab countries.

"We will actively promote the development of such a tool as interest free banking, as it opens up a good opportunity to work with international partners amid sanctions," said Gref on Friday at a shareholders meeting.

"In circumstances where we have problems with raising funds on the international markets, it is a very important thing," he said, adding that he had recently held a series of meetings in the Republic of Tatarstan with Arab investors.

Tatarstan is a central Russian region where interest free banking is being actively pursued. Investors from the Gulf States are prepared to inject huge funds in the development of such an alternative financial system in Russia, given a significant demand from the Muslim population.

The rapid growth of the Muslim population in Russia contributes to a sharp increase in demand for interest free banking tools expected in the coming years, said Samir Tagiyev, manager for business development in the CIS and Europe, the Islamic Corporation for the Development of the Private Sector (ICD), quoted by Vesti Finance.

Güncelleme Tarihi: 31 Mayıs 2015, 01:46