Bangladesh Bank Introduces Dual Banking System to Expand Islamic, Conventional Banking Access

Sangsad Bhaban, Sept 6 (V7N) – The Bangladesh Bank is introducing a Dual Banking System to expand customers' access to both conventional and Shariah-based Islamic banking services according to their religious and financial needs and to further integrate the country's financial sector with the international Islamic finance system.

Finance Minister Amir Khosru Mahmud Chowdhury disclosed this today while replying to a written question from Syed Zainul Abedin, a Jamaat-e-Islami lawmaker from Dhaka-4, in the Jatiya Sangsad.

The finance minister said Bangladesh Bank has already taken steps to introduce the dual banking system to expand customers' options to choose between conventional and Shariah-based Islamic banking services, while also strengthening Bangladesh's integration with the international Islamic finance system.

According to the minister, the Bangladesh Bank had approved 1,699 branches for full-fledged Islamic banks as of June 30 this year. Of these, 1,074 branches are located in urban areas and 625 in rural areas.

Distribution of Islamic Bank Branches

Of the 761 branches of Sammilito Islami Bank PLC:

• 206 belonged to First Security Islami Bank PLC

• 181 to Social Islami Bank PLC

• 155 to EXIM Bank PLC

• 114 to Union Islami Bank PLC

• 105 to Global Islami Bank PLC

Additionally, ICB Islamic Bank has 33 branches under the arrangement.

Of the 761 branches of Sammilito Islami Bank PLC:
- 206 belonged to First Security Islami Bank PLC
- 181 to Social Islami Bank PLC
- 155 to EXIM Bank PLC
- 114 to Union Islami Bank PLC
- 105 to Global Islami Bank PLC

Additionally, ICB Islamic Bank has 33 branches under the arrangement.

The finance minister further said 35 conventional banks currently operate Islamic banking services through 75 Islamic banking branches and 1,102 Islamic banking windows. Two more conventional banks have received approval to conduct Islamic banking operations.

The minister said the government has continued efforts to further expand the scope of the dual banking system since assuming office.

Bangladesh's Islamic banking sector has grown rapidly over the past decade. Islamic banks in Bangladesh have been among the most profitable and have attracted a wide customer base. Islamic banking operates according to Shariah principles, which prohibit interest (riba), gambling, and investment in businesses considered haram (forbidden). The dual banking system aims to provide more choice and convenience for customers with varying financial and religious preferences, while also contributing to financial inclusion. Bangladesh Bank has also taken steps to standardize Shariah governance and accounting practices across Islamic banks to ensure consistency and compliance with international standards. With the introduction of the dual banking system, Bangladesh aims to become a more prominent player in global Islamic finance.

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