Salaam Bank Ltd has been recognized as the Best Green and Real Estate Financing Institution in Uganda for the year 2024/2025. This recognition epitomizes the great commitment of the bank to ethical, sustainable, and responsible financial practices. The prestigious award was given by Public Opinions, an organization well renowned for promoting excellence in different fields apart from responsible investments.

This milestone is one of the major achievements by Salaam Bank, which started its operations in Uganda in 2023. The bank, the first commercial Islamic bank in Uganda, offers a wide range of Sharia-compliant financial products and services. These include savings accounts, home financing, personal and business loans, as well as real estate and green financing solutions. The award reflects the bank’s outstanding performance in providing financing solutions that not only benefit the economy but also align with environmental sustainability and ethical principles.

A New Era of Banking in Uganda

On March 27, 2024, the President of Uganda, Yoweri Museveni, officially launched Salaam Bank. The Chairman of Salaam Bank, Mr. Ibrahim Abdirahman, who presided over the launch, maintained that the bank was committed to serving all faiths with strict adherence to ethical values, putting humanity and the environment first. He, however, assured the public that it does not fund projects that might harm the planet or people.

The bank does not finance projects that harm humanity or the environment,” Mr. Abdirahman said. He further added that the bank was also willing to provide the government with Sharia-compliant bonds, Sukuk, to help raise capital to fund infrastructure projects. These would pave the way for the government to avoid interest-based debt while attracting foreign investment in search of Sharia-compliant financial opportunities by institutions and individuals.

Therefore, Salaam Bank turned to be an innovative but at the same time trusted institution in the spheres of sustainable finance and responsible investment. This green financing solution will go a long way toward supporting environmentally friendly initiatives; meanwhile, the real estate financing products bring an opportunity for affordable housing and thereby contribute toward the growth in Uganda’s real estate sector.

Sharia-Compliant Banking: A Sustainable Future

One of the distinguishing factors for Salaam Bank is its adherence to Sharia-compliant banking. If traditional banks charge interest on loans and investments, Islamic banking is based on the concept of profit sharing, not the receipt of interest. Financial transactions in Sharia-compliant banking are structured to avoid the element of interest; instead, it offers a partnership model where profits and risks are shared between the bank and its customers.

This type of banking ensures the investments are ethically right and the customers and investors treated fairly. These services offered by Salaam Bank go toward the attainment of the United Nations SDGs and Uganda Vision 2040 for long-term economic growth and sustainability.

The Road to Success

The entry of Salaam Bank into the financial sector in Uganda has been among the important developments in the sector. The Bank of Uganda has issued its Islamic commercial banking license to the bank on 8 September 2023. Acting Governor Dr. Michael Ating-Ego, in a speech presenting the license, was very supportive of the activities of Salaam Bank. Ating-Ego realized that Islamic banking was one avenue through which there would be marked development in the financial sector in Uganda, consequently opening up more avenues of business for both locals and consumers.

Since its incorporation, Salaam Bank has developed and introduced several Islamic banking products targeting the Ugandan market. These products have been tailored to offer quality and ethical financial services to all categories of customers irrespective of one’s religious orientation. The Djibouti subsidiary of Salaam Bank, Salaam African Bank, acquired Top Finance Bank in August 2023.

Salaam Bank Uganda has succeeded its expansion into Malaysia, Ethiopia, and Kenya in pursuit of a commercially oriented business. Its expansion reflects the fast-growing demand for Islamic financial products and services in the East African region and beyond.

Global Recognition for Innovation

These achievements have not gone unnoticed on the global stage. Recently, Salaam Bank was named the Best New Islamic Bank at the prestigious Islamic Finance News IFN Global Awards 2024 for its commitment to providing innovative, customer-centric financial solutions and its immense contribution to the growth of the Islamic finance industry in Uganda.

This was courtesy of Public Opinions presented in partnership with the Ministry of Finance, Planning and Economic Development, through an initiative advocating responsible investment and sustainable finance in Uganda. This award will be highlighted in the Uganda Development Champions Journal featuring those committed to responsible investment and sustainable finance.

Future of Salaam Bank in Uganda

In this perspective, the focus of Salaam Bank in furtherance will continue with ethical and responsible banking to benefit Ugandan people. So far, its operation methodologies have resulted in altering some tendencies within the financial industry and offered an unusual set of alternatives against conventional banking for environmental sustainability and responsible investment.

This positive recognition of Salaam Bank’s efforts in green and real estate financing further ascertains the bank’s leading role in this field. With the furtherance of Uganda’s development of the economy and infrastructure, Salaam Bank’s Sharia-compliant financial solutions will increasingly contribute to supporting growth while holding onto ethical values in a strong manner.

With a responsible banking and ethical financing focus, Salaam Bank will always be at the edge in Uganda’s financial sector and will always set examples for other institutions to follow. As the bank is increasing its offerings and deepening presence in the country, this impact will be long-lasting on the economy of Uganda and generally in society.