In a move that could challenge Bahrain’s status as an international financial hub, MP’s are set to debate a proposed law that will force all financial establishments in the kingdom to adopt Islamic banking over conventional banking practices. The draft law has been proposed by the National Consensus Parliamentary Bloc and recommended by parliament’s financial and economic affairs committee.
The Supreme Islamic council has backed the proposed bill saying that Bahrain should start implementing Islamic banking practices gradually but within a set time frame rather than ending conventional banking in one go, taking into account the financial status of the country, and the existing financing and loans.
However, the Central Bank of Bahrain (CBB) rejected the proposed bill saying that banking choices are the hallmarks of a free market. “We can’t interfere in people’s choices and force them to accept a particular method if they don’t want to deal in it”, CBB said in a written statement.