Celebrating its first anniversary, Morocco’s Islamic banking industry is facing a colossal challenge as only a minority of the population truly believe that financing products offered by Islamic banks and windows are Shariah compliant while the majority are in the dark or in disbelief, a study has found. MARC ROUSSOT reports.
A tremendous educational effort is required from market players and regulators as only 18% of Moroccans consider Islamic product offerings as Shariah compliant while 22% and 15% of the population do not know and do not want to answer respectively.
The development of the industry may be even more difficult in the years to come as the level of rejection of the industry is highest in the youth. Out of the 1,000 Moroccans nationwide surveyed by market research firm Sunergia, 52% of the 15-24 age group and 50% of the 25-34 age group affirm that financing products are not Halal.
The middle class (20%) and the lower classes (18%) recorded the highest number of people convinced that Shariah compliant financing solutions are true to Islamic principles while only 10% of the richest Moroccans have faith in the industry.
It is unclear why about four Moroccans out of 10 believe that the industry is not genuinely Islamic as the study ordered by Morocco’s newspaper L’Economiste did not address this question.
However, this second study confirms Moroccan’s strong lack of understanding and awareness about the industry. A survey published in December last year by Kantar TNS revealed that only 7% of the Moroccan population had heard about participatory finance and 21% about Islamic finance.
A majority of Moroccans interested in Islamic banking were also erroneously expecting Shariah products to be cheaper than conventional ones, associating the religious characteristic of the industry with charity.