Jaiz Bank does not recognise Non-Permissible Incomes (NPI) in its books because it is against the tenet of Non-interest banking principles.
Such Incomes are kept aside and given to charity, Abdulfattah Amoo, Jaiz Bank’s Executive Director in charge of the Southern operations made the clarification at the weekend in Ibadan, Oyo State.
Amoo was speaking at an engagement session with the Ulama and other stakeholders as part of the Bank’s activities to deepens the understanding of Non-interest banking and it’s benefits to individuals and society at large.
He said in most cases, NPI are normally due to penalties on default from customers and not because “we are violating Sharia principles, it is just that some customers did not live up to their obligations.”
He said: “It is not that the dynamics or the way we sold the product or the sequence of what we did is what went wrong. It was because the customer was negligent and didn’t play his own part in the contract.
“The law of regulations within Sharia permits Islamic banks to charge penalty to shape the right behaviour.”
Amoo explained further that the Bank is not allowed to take a kobo out of such penalty because “it is not my own income. It is Non-Permissible Incomes and would be given to charity.”