World Monitor Magazine, Economy WM_April 2019 web version (2) | Page 24

EXPERT OPINION
In October 2018, Islamic home
finance was launched, which was the
first product of Islamic finance for
individuals in Kazakhstan.
Islamic home finance is realized
through trade - the Murabaha
instrument. The client chooses housing
in the primary or secondary market and
provides a down payment, the bank
buys this housing and then sells it to
the client with an installment charge.
The client knows the amount of the
margin and the amount of the monthly
payment, and this amount remains
unchanged for the entire period.
Payments are equal for the entire term
as well as an annuity, but there is no
overpayment peculiar to it.
Conditions: housing commissioned,
with a down payment from 30%, a
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term from 3 to 15 years, the amount
of financing from 3 to 200 million
tenge, and a minimum income of
200,000 tenge (minus tax and pension
contributions).
Islamic Banking Myths
"Zero Interest means free" An
Islamic bank is a commercial bank
that operates in accordance with the
rules and principles of Sharia, and
should be profitable, safe and increase
the funds of depositors, shareholders,
and investors. The absence of interest
rates does not mean that financing in
an Islamic bank is free. According to
Sharia, charging usury and interest
from loan are prohibited. Unlike
conventional banks, Islamic banks
do not offer loans but involve trade,
leasing and partnership structures and
there is no speculative component.
"Only for Muslims" Any person,
regardless of religion, can become a client
of an Islamic bank. Religion is not the only
reason for using Islamic banking products.
Many clients choose Islamic banks
because of their reliability, especially in
a period of instability in the economy,
since they are more careful in choosing
financing projects, investing only in real
sectors of the economy, and are not
involved in speculative transactions. In
this connection, they can be more reliable
in the long term.
But there is also a share of clients for
whom it is important that the bank
adheres to the principles of Islam. For
such clients, an Islamic bank allows them
to use the products of modern banking,
without violating their moral and ethical
principles.