SunTrust Bank and the Islamic Corporation for the Development of the Private Sector (ICD) have signed a Memorandum of Understanding (MoU) on a 10 million dollars credit facility.
The credit facility is to support non-interest banking in the country.
The Managing Director of SunTrust Bank, Mr. Muhammad Jubrin, said that the facility would provide finance to people who do not need to take funding on an interest basis.
The MoU signing was at the ongoing third edition of the Africa Islamic Finance Forum organized by the Federal Ministry of Finance in collaboration with the ICD in Lagos.
Jubrin said the bank’s additional line of finance would also support Micro Small and Medium Enterprises (MSMEs) for the development of the private sector.
He said it would also help to boost individual businesses, particularly among farmers who do not have access to finance.
According to him, the two reasons informed the decision to meet with the ICD to get the financing.
He said that the non-interest banking, based on interest-sharing, considers that the institution had more stakes and more interest in the business to ensure that the businesses succeed.
“Ordinarily, in other lines of finance where you have interest, more often this interest continues to accrue, and that of the terms and conditions.
“Also, tenure and other factors make it difficult for customers to meet the obligation.
“We believe that an institution that provides non-interest banking tango along with the individual as a partner that provides funding for those who do not have access to finance.