At a event that took place at Kololo Independence Grounds, Uganda’s Fountain of Honour, President Museveni opened, the Salaam Bank, Uganda’s first ever licensed Islamic Banking institution.
Islamic banking is a form of banking based on Islamic principles.
Basically, in Islamic banking it is not allowed to pay and receive interest but rather it is based on profit sharing.
Islamic banks focus on generating returns on investments through investment tools that are “Sharia” compliant.
The President launched the bank on Wednesday during Ramathan dua prayers organised by the Office of the National Chairman-NRM at Kololo Ceremonial Grounds.
President Museveni further said as the NRM, they don’t believe in discrimination, and they serve all Ugandans equally irrespective of their religions or tribes. He said such attribution has enabled the country to develop socially and economically.
“When Amin left, those of Lule dislodged Uganda from the Organization of Islamic Cooperation (OIC) saying that the majority of Ugandans are not Muslims but when we took over power, we readmitted the country back to OIC. I told them that some of my people are Muslims so they must belong to such an organisation and it was also not a taboo to belong to OIC even if you are not a Muslim. We believe in politics of interest not identity,” he said.
“When the Islamic University in Uganda was beginning, some people were against it. I said no, leave it to operate. Now, it has produced so many graduates of different professions including non-Muslims. When they told me about Islamic banking, I told them I have no problem with it. I said we should let them operate and that is why we have Salaam Bank now.”
President Museveni also welcomed the bank to Uganda, before assuring them of support to smoothly run their operations in the country.
“I welcome Salaam Bank to Uganda. This is a big market with a population of 48 million now and in the next 27 years, the population of Uganda will be 106 million. You are going to start right away to serve the people of Uganda,” he said.
The Minister of Foreign Affairs and International Cooperation of Djibouti who led the Djiboutian delegation to Uganda, Mr. Mahmoud Ali Youssouf, extended warm greetings of the President of Djibouti, Ismaïl Omar Guelleh to President Museveni.
Mr. Ali Youssouf underscored the inspiring ambition of the Salaam Group to broaden the scope of its activities all over the continent including Uganda which he said has a safe and solid financial institution.
The Board Chairman of Salaam Bank, Mr. Ibrahim M. Abdirahman informed the President that he signed the Islamic bank regulations into law at a time when the Islamic community really needed it.
“Indeed, you have been a true friend of this community. This licence for Salaam Bank was handed over to us on the 8th of September 2023, which was the birthday month of Your Excellency, Mr. President, we sincerely thank you for supporting us wholeheartedly. The establishment of an Islamic Bank marks a significant milestone in Uganda’s journey towards economic empowerment and inclusive financial growth,” he said.
“Islamic finance offers among others, Shari’a compiled bonds from which the government can raise capital for various infrastructure and projects. We are hopeful that the government of Uganda will embrace this opportunity because of its immense benefits.”
In September last year, Bank of Uganda granted its first Islamic banking license to Salaam Bank Uganda Ltd, a subsidiary of a Djibouti-based bank after Parliament passed legislation to authorize Islamic banking, which President Museveni signed into law in August 2023.
The event was also attended by Salaam Bank officials, Ugandan government officials, religious leaders, among others.
Additional Reporting by Chimpreports.