Economy, Business And Markets

Usury-Free Banking Law Revised

Usury-Free Banking Law Revised
Usury-Free Banking Law Revised

The parliament is investigating amendments offered by a specialized religious studies committee to revise the current usury-free banking law, said a member of the jurisprudence council at the Central Bank of Iran (CBI).

“The usury-free banking law has 27 articles, while the amended law has 58 articles,” Mohammad Taqi Nazarpour told FNA.

Nazarpour said changes have mainly been proposed for monetary policies, including the recovery of overdue debts, and fines regarding those debts.

He added that the suggestions are based on usury-free banking and that the committee has taken account of both the challenges and progresses in the Islamic banking system.

He added that the parliament will pass the amendment proposal after it is examined by the parliament.  

After the 1979 revolution, the CBI was tasked to prepare an Islamic banking law. In 1983, the Islamic banking bill passed the parliament. According to the law, Iranian banks can only engage in usury-free transactions.

In 2009 Iranian banks accounted for about 40% of total assets of top 100 Islamic banks in the world. Three of the leading four Islamic banks are based in Iran including Bank Melli, with total assets of $45.5 billion in value, Bank Mellat with $39.7 billion, and Bank Saderat with $39.3 billion.

Caption: Iranian banks make a major contribution to Islamic banking.