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 22 world monitor 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.