LUTON,
Britain, July 8 (IslamOnline.net & News Agencies) – HSBC banking
group has become the fist high street bank in Britain to offer
mortgages and current accounts in accordance with Shariaa (Islamic
law), a British news paper said.
The
HSBC plan will allow Muslims in Britain to buy a house without having
to pay or receive interest, which is prohibited in Shariaa, Bedford
Today newspaper said.
Under
the new scheme, the bank will buy the property outright on the
customer's behalf and lease it back to them for an agreed term,
usually 25 years, the same period as a traditional mortgage.
The
customer will make monthly payments made up of rent and contributions
towards the purchase price.
Muslim
leaders in the British town of Luton, the historic county of
Bedfordshire, have given, however, a cautious welcome to the HSBC
decision.
"I
have not studied the plan in detail, but I think it is encouraging, it
is a step in the right direction, although I think there should be
more of a profit-sharing element to it," said Mohammed Bashir, a
Luton councilor representing the Dallow ward in Luton.
"The
launch of these Islamic finance products by HSBC is welcome news for
many thousands of Muslims who regularly battle with their consciences
when it comes to making financial decisions," the BBC News
Onlilne quoted Iqbal Asaria, the spokesman of the Muslim Council of
Britain, as saying.
"Some
(Muslims) are wracked with guilt because they have broken Islamic law.
While others' values are beyond question, they are more pragmatic in
order to keep a roof over their family's head.
"HSBC's
initiative frees them from this dilemma and is the first step to
delivering a level playing field for Muslims seeking financial
solutions in the U.K.," he added.
The
current account and mortgage products are to be introduced in selected
HSBC branches from 14 July, the BBC said.
HSBC's
Asia-Pacific chairman David Eldon said previously that the bank would
like to
expand a London office, which currently offers advice to Muslim
clients.
"If
we introduce Islamic banking products into this market which find
acceptance from the customers here, yes, we would be interested,"
he said.
