Kenya has adopted the legislation for Islamic banking which has shariah laws that forbid collecting and receiving of interest also known as riba to loan borrowers.
Islamic banking which works as a trading & investment house, resembles conventional banking transactions such as loans bearing fixed interest rates and repayable on a fixed date.
Islamic Banking is growing at a rapid speed and has shown unprecedented growth and expansion in the last few years in spite of mismatching of existing financial framework and business practices.
Below are Banks in Kenya that offers Islamic banking or shariah-compliant banking in Kenya to cater to customers personal, business, and corporates financial needs.
1. First Community Bank of Kenya
First Community Bank (FCB) is the first fully-fledged Sharia-compliant bank in Kenya approved by the CBK. It offers services that comply with the Sharia, serving all its customers more ethically than other banks.
The Bank received formal approval from the Central Bank of Kenya back in 2007 paving the way for ethical banking in the whole East and Central African region.
FCB value proposition is to be “The Home of Sharia Compliant Banking.” as it delivers innovative Sharia Compliant Financial Products, Services and Solutions at more competitive rates than other banks.
2. Dubai Bank of Kenya
DIB Bank Kenya Limited (DIBBKE), is a fully owned subsidiary of Dubai Islamic Bank PJSC (AE) – a pioneering institution that has combined the best of traditional, Shariah values with technology and innovation that characterize the best of modern banking.
Incorporated in 2014 and backed by its age-old values of being Progressive, Innovative, Ethical and Reliable, DIB Bank Kenya has put in place channel capabilities, high quality of service and a sound business model to ensure that it is ‘The Better Way to Bank’.
The bank’s tradition and heritage are blended with a commitment to flexibility, innovation and modernity so that every customer is provided with comprehensive Shariah-compliant solutions for any financial need.
3. Gulf African Bank of Kenya
Gulf African Bank was started by a group of motivated Kenyans who envisioned an Islamic bank as an alternative to conventional banking in 2005.
This bank would conduct business on the principles of Shariah and provide ethical and fair banking for all. The bank would leverage strong links between the Gulf and Africa to establish a channel for attractive investments in Kenya.
It became the first Islamic Bank in Kenya incorporated on August 9th 2006 and was fully operational on January 8th 2008 as Kenya’s first full-fledged commercial banking license from the Central Bank of Kenya as a dedicated Islamic bank.
4. Middle East Bank of Kenya
Middle East Bank Kenya Ltd (MEB) was incorporated in Kenya in October 1980 and established business in August 1981 with branches in Nairobi and Mombasa. It was established in Kenya as part of the Al-Futtaim Group, a leading conglomerate from the United Arab Emirates owned by Middle East Bank Group, UAE.
In 1991, Al-Futtaim sold its shareholding in MEB and thus in April of that year, control of the bank passed from foreign to local investors thereby Kenyanising its ownership.
With over 30 years of operating in Kenya, the sharia-compliant bank serves a broad range of clientele with branches in Nairobi, Mombasa and Eldoret.
5. Sharjah Islamic Bank
Sharjah Islamic Bank, formerly known as the National Bank of Sharjah, is a publicly listed Islamic bank headquartered in the emirate of Sharjah in the United Arab Emirates.
The bank was established in 1976 and in 2004 converted into a fully Shariah-compliant bank.
6. Bank of Baroda Kenya.
Bank of Baroda, a shariah-compliant bank, began its Overseas Operations by opening a branch at Makadara Road, Mombasa in Kenya.
Later, on 03rd October 1959, another branch was opened at Digo Road in Mombasa. Subsequently, in 2002 Makadara Branch was merged with Digo Road Branch, Mombasa.
On 21st January 1992 the subsidiary, Bank of Baroda (Kenya) Ltd was incorporated with 86.70% shareholding of the Bank of Baroda, India and 43 local shareholders constitute the remaining 13.3%.
The bank is offering all the Banking services to its customers, enabled with transaction-based banking- Internet Banking, RTGS (Domestic) & ready to offer cross border RTGS among East African Countries through East African Payment System (EAPS), Mpassbook, Debit Card, SMS banking, Mobile banking etc.