Mozambican business leaders and financial sector representatives on Thursday, 24 September, called for the diversification of funding sources through Islamic finance, arguing that the model could help broaden access to capital, promote productive investment, and strengthen financial inclusion in the country. The issue was raised during the launch of the book Introduction to Islamic Finance: Principles, Contracts and Intermediation Models, at a session attended by government representatives and industry specialists.
Salimo Abdula, entrepreneur and founder of Intelec Holdings, argued that Islamic finance should not be viewed merely as a religiously motivated alternative to the conventional financial system, but as an opportunity to diversify the range of funding sources available in the market.
"Finance must also be understood as an opportunity for our market and for the country, in the sense of diversifying our funding sources, promoting productive investment, strengthening financial inclusion, and bringing capital closer to the real economy," Abdula said.
For the businessman, the introduction of Islamic finance instruments would represent an addition to the financial alternatives already available in Mozambique. Abdula nonetheless stressed the need to deepen understanding of how Islamic finance works, both among the general population and within the Muslim community itself.
"I think it is an addition to the system and to the financial alternatives that already exist in our market. Its rules were well explained. Sharia law has its main principles. Obviously, it was also noted that regulation needs to be addressed — something the regulator already has in mind. But conditions must be created so that this information reaches those who remain unfamiliar with what Islamic finance means," he said.
Also speaking at the event, Edson Manguinhane, executive administrator of the Banco Nacional de Investimento (BNI), highlighted the institution's experience in mobilising financing from international partners linked to Islamic finance.
He explained that the bank works with institutions including the Abu Dhabi Fund, the Arab Bank for Economic Development in Africa (BADEA), and the Islamic Development Bank, having secured its first Islamic finance credit line in 2016.
"Our first financing line that we mobilised in the context of Islamic finance was in 2016, through the Islamic Corporation for the Development of the Private Sector (ICD). The type of contract we agreed with the Islamic Bank was a Murabaha structure, aimed at financing small and medium-sized enterprises in the acquisition of equipment, among other needs," Manguinhane said.
He identified the legal framework as one of the principal challenges encountered during the implementation of that credit line, noting that at the time Mozambique did not yet have specific legislation for participatory finance, which required BNI and its partners to devise mechanisms to make the operation viable.
While acknowledging legislative progress since then, the BNI executive administrator said more specific regulation was still needed, covering governance, compliance, prudential standards, and taxation.
"At the moment, although the law provides a framework for participatory finance, other challenges remain — such as the need for specific and autonomous legislation or regulation for Islamic finance. There are, for example, questions around governance and compliance standards. How do we ensure that banks and insurers implementing Islamic finance products are in compliance?" he asked.
Taxation was identified as a further challenge. Manguinhane explained that certain Islamic financing structures involve transactions that may generate additional tax costs compared to conventional banking, a situation he said could undermine the competitiveness of these products.
A lack of financial literacy was also flagged as a barrier to the model's expansion. According to Manguinhane, BNI's experience showed that limited awareness of the products and how they function hampered the placement of instruments among potential beneficiaries.
"The other issue we noticed during the implementation of the line we had with ICD relates to unfamiliarity and a lack of financial literacy. Often, even within the Islamic community, people do not sufficiently know Islamic finance products, how they work, and what their characteristics are," he said, adding that financial education should be integrated into a broader financial inclusion strategy and could begin at the earliest levels of schooling.
Bilal Seedat, a tax consultant and member of the Muslim Association of Business People and Entrepreneurs of Mozambique (AMEM), highlighted the interest of the Muslim business community in the development of Islamic finance in the country.
Seedat added that AMEM intends to play an active role in the development of Islamic finance in Mozambique, stressing that the association is not merely a bystander in the debate but has been engaging with various stakeholders since the book's publication.
"AMEM is not a mere observer in this Islamic finance process — it has been very active and has been engaging since the publication of the book," he said.
Participants in the debate also underscored that the existence of a significant Muslim population does not in itself guarantee the development of Islamic finance. The model's expansion will also depend on the availability of appropriate products, adequate knowledge among operators and clients, a clear regulatory framework, and conditions that allow its integration into the national financial system.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/2026/09/25/economia/financas/empresarios-defendem-diversificacao-do-financiamento-com-recurso-as-financas-islamicas/
