Sunday, October 23, 2011

Intel Offers Sharia-Compliant Financing



Intel is working with an Islamic bank to offer consumers Pakistan’s first large-scale hire purchase scheme for personal computers, aiming to increase its market share in the country.

The US chip group hopes its partnership with Karachi-based Meezan Bank will boost sales of laptops to buyers who would otherwise struggle to afford a computer in the country of 180m people. It is also considering expanding the scheme to other emerging markets.

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However, Pakistan’s Islamic banking sector has seen significant growth in recent years. Meezan, which started operations as Pakistan’s first Islamic bank in 1997, is vying for market share with a range of international Islamic banks based in Gulf countries that now offer their services in Pakistan.

For its part, Meezan wanted to promote Islamic finance, said Irfan Siddiqui, chief executive. “Our main objective is to use this for people to understand more of what the bank is doing generally.” The lender hopes that laptop customers may in turn take bigger loans from its existing range of sharia-compliant car loans and mortgages.

Meezan said it had signed hire purchase agreements for computers with 400 people since launching the scheme in May, via promotional drives at Pakistani universities. The bank is aiming to sign another 3,000 such agreements in 2012.

With the agreements typically running for 12 or 24 months, the repayments work out at roughly 100 rupees per day for the computers.

Mr Siddiqui said that so far there had not been a single default among laptop buyers. “Our default rate on this product up to now is zero – people have repaid us without any problem,” he said.


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