Traditional banks will provide Islamic banking services in the "Islamic window" format
Traditional banks in Kazakhstan will be able to provide Islamic banking services in the "Islamic window" format. This innovation, provided for in a draft of the new law on banks and banking activities will allow banks to work with Islamic financing without changing their core activities.
This approach will open up new opportunities for investors, including foreign ones, and ease entry into the Islamic banking market. This will help improve availability of Islamic banking services for population and businesses.
Based on results of studying the international experience and consulting with central banks and regulators of foreign countries, the Agency has picked a liberal model for regulation of the "Islamic windows". This model is suitable for traditional banks. Closer interaction between the "Islamic window" and the traditional part of the bank is allowed, and also ensures autonomy of the bank's internal Islamic councils.
Key requirement for "Islamic windows" will be separation of their operation from core activities of the bank. All operations related to Islamic banking will be taken into account separately. Managers of Islamic windows must have qualifications in the Islamic financial law.
Moreover, special financial regulations for Islamic operations will be developed. Overall, the suggested changes will help banks work effectively with Islamic finance, while sticking to the Sharia principles.
External Communications Department