- Ahmad El Najjar
Dr. Ahmad El Najjar is the economist who pioneered the formation of the
Islamic Banking system by setting up the Mit Ghamr Savings Bank inEgypt in 1963.This took the form of a
savings bank based onprofit-sharing in the Egyptian town ofMit Ghamr . The experiment lasted until 1967, by which time there were nine such banks in the country. These banks, which neither charged nor paidinterest (orRiba in Islamic terminology), invested mostly by engaging in trade and industry, directly or in partnership with others, and shared the profits with their depositors (Siddiqi 1988). Thus they functioned in essence as saving-investment institutions rather than ascommercial banks . Subsequently, The Nasir Social Bank, established in Egypt in 1971, was declared an interest-free commercial bank, although its charter made no reference toIslam orSharia .El Najjar's experiment with Islamic Banking was initially undertaken under cover, without projecting an Islamic image, for fear of being seen as a manifestation of
Islamic fundamentalism which was anathema to the political regime at the time.References:
Siddiqi, M.N.,1988. 'Islamic banking: theory and practice', in M. Ariff (ed.)
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