Within a few months Uganda’s Parliament will amend some clauses to the Financial Institutions Act 2004 to allow Islamic banking.
This is banking according to Islamic principles. Supporters think this kind of banking will provide an alternative to what they consider to be high interest rates charged by commercial banking institutions.
It is very important to point out that Shariah-compliant banks do NOT lend money for free. The industry spreads that lie repeatedly, as repeated above, to dupe people into accepting Shariah finance.
The reality is that, even though Shariah financial institutions do not charge interest, they do charge fees and impose costs on customers that almost always amount to higher borrowing costs for customers, even though they are “interest-free.”