Jaiz Bank has explained that it does not recognize unauthorized income (NPI) on its books because it violates the principles of non-interest-bearing banking.

Abdulfattah Amoo, the executive director of Jaiz Bank in charge of southern operations, which provided the clarification over the weekend in Ibadan, Oyo State, said such earnings are being kept aside and given to charities.

According to the management of Jaiz Bank, Amoo spoke with the Ulama and other stakeholders during an engagement session as part of the Bank’s activities to deepen the understanding of non-interest-bearing banking and its benefits for individuals and society at large.

He said in most cases NPI is usually the result of fines for customer default and not because “we are violating Sharia principles; it’s just that some customers didn’t fulfill their obligations.”

“It’s not that the dynamics or the way we sold the product or the order of what we did is what went wrong. It was because the customer was negligent and did not play his own part in the contract. The law of regulation within Sharia law allows Islamic banks to charge fines to shape the right behavior,” Amoo further explains.

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Amoo reiterated that the Bank is not allowed to take a kobo out of such a fine because “it is not my own income. It is an unauthorized income and would be given to charity.”

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