181
Issues and Challenges Recommendations
Lack of provision for the
Shariah-compliant guarantee
or credit enhancement
The SEC to engage with the IDB to work on provisions for
Shariah-compliant guarantees.
Lack of NICMPs To promote and educate market stakeholders on how to
structure more Shariah-compliant products.
Inadequate tax neutrality The SEC to collaborate with the tax authorities to accelerate the
process of addressing tax provisions that may impede or
discourage product development and innovation.
Inadequate tax incentives The SEC to work closely with the other regulators to initiate
further measures to improve incentives, i.e. waiver of 50% on
regulatory fees, reduction of tax rate and shorter turnaround
time for the issuance of NICMPs. To also consider extending the
current tax incentives to sukuk issued by non-sovereign bodies.
Sources: RAM, ISRA
Table 4.38: Recommendations to Improve Demand (Buy Side) – Medium-Term Solutions
Lack of awareness (including
religious groups) on the
domestic market for NICMPs
To effectively execute the awareness programmes on the NICMP,
as detailed in the Report of Capital Market Literacy Master Plan
Committee issued in 2015. The CBN and the SEC to engage with
influential religious bodies, e.g. the National Christian Elders
Forum (NCEF), to create mutual understanding on NICMPs.
Lack of external investors Operators to promote a wider range of NICMPs to create
opportunities to tap external non-interest investment funds.
Sources: RAM, ISRA
Table 4.39: Recommendations to Improve Infrastructure – Medium-Term Solutions
Cumbersome registration
process for mortgages
The Land Use Act (LUA) should be amended to facilitate the
process for the perfection and transfer of title, to make the
creation of mortgages less cumbersome. Thus, the SEC is to
engage with the governors and relevant stakeholders in the land
registry to create a level playing field for property acquisition
using non-interest structures with conventional structures and
dispense with the need to seek consent twice.
Lack of savings mobilisation
policies and programmes
The Technical Committee on National Savings Strategy has to
expedite the release and execution of the road map for a national
savings strategy.
Low uptake of insurance
services despite enormous
exposure to risk for the low-
income and mass-market
population
NAICOM to work with the FGN to create incentives that will spur
increased uptake of insurance services.
Social discontent. As a multi-
ethnic society, minority
interests or fears based on
diversity are a source of
discontent.
The government needs to take proactive measures to address
social, political and economic challenges.
Sources: RAM, ISRA