Prospects and Challenges of Establishing Islamic Banks in Ethiopia
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Date
2008-06
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A.A.U
Abstract
The purpose of the study is to identify the prospects and challenges of establishing
Islamic banks. Seventy five survey instruments were distributed to assess the views of the
Muslim business community's awareness and attitude towards Islamic banking and
banking in general. The study also addresses favorable conditions and also challenges in
the establishment of Islamic banks. Books and articles from several websites were
extensively used in addition to the questionnaires. The study showed that even if there is
low awareness level among Muslim community about Islamic banking products,
establishment of Islamic banks is highly required by the Muslim business community. The
study further showed that there are challenges like lack of professionals in the field of
Islamic banks. The study recommends that Islamic banks, which basically works under
the scheme of profit and loss sharing, should be established to cater divergent needs of
different customers particularly those who do not want to deal with interest. It also
recommends high level of support from the government particularly effective legal
framework ensuring speedy justice is essential for the success of Islamic banking
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Keywords
challenges of establishing, establishin