More Islamic banks needed to promote Moslem entrepreneurs<\/p>\n
JAKARTA (JP): Indonesia needs to set up more interest-free
\nIslamic banks to help promote Moslem entrepreneurs and allow them
\nto compete better with the powerful conglomerates, noted
\neconomist Sri Bintang Pamungkas says.<\/p>\n
Bintang, who is also a member of the House of Representatives
\nof the United Development Party (PPP) faction, accused the
\ngovernment of neglecting the needs of Moslem entrepreneurs and
\ncatering the needs of a few big businesses.<\/p>\n
He suggested that to remedy this, the government needed to
\nconvert up to five state banks to be ran along the Islamic
\nbanking principles that do not charge interests on loans.<\/p>\n
His proposal was made during a seminar organized by the
\nUniversity of Attahiriyah to discuss alternative sources of funds
\nfor Islamic activities, including for enterprises run by Moslems.<\/p>\n
Seven government banks are among the largest in Indonesian
\nbanking. They are BNI 1946, BDN, BBD, BRI, Bank Eksim, Bapindo
\nand BTN.<\/p>\n
Bintang said some 200 conglomerates jointly account for around
\n80 percent of the country's gross national product.<\/p>\n
Moslems, in contrast, play such a marginal role in the
\ncountry's economy that, even if they join forces, they will not
\nbe able to compete against the big and powerful businesses, he
\nsaid.<\/p>\n
\"They will be like snails trying to compete against foxes,\" he
\nsaid.<\/p>\n
Bintang said Moslem entrepreneurs either do not enjoy access
\nto state funds like the conglomerates do, or are reluctant to
\navail themselves of them because they believe that interest
\npayments are illegal.<\/p>\n
Chairman of the Jakarta Preacher Corps H.A. Sumargono during
\nthe seminar said there is still a raging debate among Moslem
\nscholars about whether or not interest payments on loans are
\nharam (forbidden by religion). On the other hand, experts say
\nbanks cannot run without charging interest on loans.<\/p>\n
The Bank Muamalat Indonesia, founded three years ago, found a
\nway around this dilemma by introducing the profit sharing scheme.
\nIt is the first Islamic bank set up in Indonesia.<\/p>\n
Difficulties<\/p>\n
Sumargono said that while Bank Muamalat's presence was
\nwelcome, it has yet to reach the grassroots level of Moslems with
\nmost of the funds going to medium and big enterprises. \"When
\nsmall-scale entrepreneurs come to the bank, moreover if they wear
\na sarong and Moslem cap, the bank's staff will look the other
\nway.\"<\/p>\n
M. Syafii Antonio of the Bank Muamalat denied that there was a
\npolicy of not helping the small entrepreneurs but he admitted
\nthat his bank has had difficulties in channeling funds to small
\ncompanies because they are mostly incapable of managing the
\nmoney.<\/p>\n
Syafii said his bank alone could not solve all the economic
\nproblems of the Moslem community.<\/p>\n
He stressed that the objective of the bank was to pave the way
\nfor more banks operated along the Islamic profit-sharing
\nprinciples.<\/p>\n
Bintang in his presentation proposed four schemes which can be
\ndeveloped to promote the Moslem's economy. They are joint-venture
\nfunding, muzarokah management, small and medium Business
\nAdministration (SMBA) and profit-sharing banking system.<\/p>\n
Joint-venture funding is a type of giving helping hands from
\nbig companies to small and medium ones. Muzarokah is a system
\nallowing landowners, who are mostly poor, to own shares in
\ncompanies which use their plots for business sites.<\/p>\n
\"A clear example of this is when the people who owned plots
\nalong Jl. MH Thamrin and Jl. Jend. Sudirman were forced to sell
\ntheir land cheaply. If the government had the political will to
\ndefend the poor, it would have used muzarokah system by involving
\nthem in the development of the city, so that they could also
\nenjoy the fruits of development,\" Bintang said.<\/p>\n
SMBA is an institution to provide assistance to small and
\nmedium business companies to find alternative funding. (11)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/more-islamic-banks-needed-to-promote-moslem-entrepreneurs-1447893297",
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