Aug 25, 2026
By Edward Makuzva
The Zimbabwe National Zakat Fund (ZIMNZAF) has called for the adoption of an interest-free Islamic banking framework in Zimbabwe, saying the system could broaden financial inclusion, unlock new sources of investment, and support the country’s drive towards an upper middle-income economy by 2030.
Speaking at the inaugural Islamic Banking Indaba in Harare, ZIMNZAF National Director Sheikh Henry Balakazi said Zimbabwe should consider amending its banking laws or promulgating a statutory instrument to accommodate Islamic banking alongside the conventional banking system.
He added that the move would enable Zimbabwe to attract both domestic and foreign investors and depositors who preferred financial products structured in accordance with Islamic principles.
Sheikh Balakazi highlighted that the introduction of Islamic banking was consistent with President Mnangagwa’s call for Zimbabwe to remain “open for business” and urged stakeholders to view the system as an additional avenue for mobilizing capital rather than as a replacement for conventional banking.
“Islamic banking offers solutions, as it helps to curb banking barriers, money laundering, and terrorism financing,” he said.
He argued that the absence of a formal legal framework for interest-free banking had created a barrier for investors and members of the Muslim community who sought financial services compatible with their religious beliefs.
“The current financial framework and Banking Act in Zimbabwe are exclusive of an interest-free banking system. That in itself is a huge banking barrier because both local and foreign investors, who are serious in adhering to a system of banking that is in line with God’s law, are prohibited in-country,” Balakazi explained.
Broadening financial inclusion
Sheikh Balakazi revealed that Zimbabwe needed to give financial services consumers greater choice by creating an enabling environment for different banking models to operate within the country’s financial system.
He said Islamic banking could help bring into the formal financial system people who were currently reluctant to use conventional banking products because of the charging or payment of interest.
According to Sheikh Balakazi, Zimbabwe’s Muslim community represents a potentially significant pool of deposits that could be mobilized through appropriate financial products.
“Islamic banking offers an opportunity for banks to mobilize deposits, especially from believers who are keeping their monies at home, and be able to lend out more for further investments,” he added.
He said increased mobilization of deposits would strengthen the capacity of financial institutions to channel funds towards productive sectors of the economy.
This, he said, could contribute to increased investment, production, entrepreneurship, and job creation while supporting the government’s broader economic development objectives.
Islamic banking, he explained, is based on principles that prohibit interest while encouraging trade, investment, asset-backed financing, and the sharing of profits and risks.
“It promotes production and profit-making and avoids interest as per God’s law and teaching to mankind. It is an alternative means of financial intermediation which has its roots in divine principles,” he said.
Religious principles
Sheikh Balakazi highlighted that the principles underpinning Islamic finance were not exclusive to Islam, arguing that restrictions on usury and exploitative lending could also be found in other Abrahamic religious traditions.
He cited Deuteronomy 23:19, which discourages charging interest on loans to fellow believers, and referred to verses 278 and 279 of Surah Al-Baqarah in the Qur’an, which prohibit riba, commonly translated as usury or interest.
He said these religious teachings demonstrated that ethical concerns surrounding lending and interest were not unique to Islam.
Sheikh Balakazi also linked the proposal to the constitutional recognition of the role of Almighty God in Zimbabwe’s national life.
“The Constitution of Zimbabwe says in the preamble that ‘we the people of Zimbabwe acknowledge the supremacy of Almighty God in whose hands our future lies’,” he said.
“This clearly shows that the majority of Zimbabweans are believers in God. In aligning our laws to the Constitution, it is prudent to also include the divine arrangement. Hence the need for the Islamic Banking System.”
Call for legal reforms
The ZIMNZAF director added that the Islamic Banking Indaba was intended to provide a platform for stakeholders to examine the concept, dispel misconceptions and develop practical recommendations for the government.
“This Indaba will unpack Islamic banking and clear misconceptions that some of you may have about it and, at the same time, make recommendations to the government in terms of the way forward,” he said.
He called for Zimbabwe to consider introducing the necessary legal reforms through a statutory instrument or an amendment to the Banking Act.
Such reforms, he said, would allow Islamic banking products to operate legally within the country’s financial system and enable financial institutions to serve customers with different banking preferences.
Sheikh Balakazi stressed that Zimbabwe would not need to establish an entirely separate banking infrastructure.
“The process does not require reinventing the wheel, as Islamic banking can run together with the current conventional system using the same banks and facilities, giving options to users,” he said.
Tapping international investment
The proposed reforms, he said, could also position Zimbabwe to benefit from growing international interest in Islamic finance.
As the country pursues its economic diplomacy agenda and seeks to deepen engagement and re-engagement with other nations, Sheikh Balakazi said Islamic banking could provide another channel for attracting capital from Muslim-majority countries and international investors seeking Sharia-compliant financial opportunities.
He revealed that Zimbabwe should take advantage of such opportunities as it works towards President Mnangagwa’s Vision 2030 of attaining upper middle-income economy status.
“The government’s policy of leaving no one and no place behind, as well as the renewed economic diplomacy efforts of engaging and re-engaging progressive nations to open new trade and economic frontiers, requires Zimbabwe to broaden its financial architecture,” he said.
He maintained that accommodating Islamic finance would allow Zimbabwe to tap into both domestic and international pools of capital that could otherwise remain outside the formal banking system.
Regional precedents
Sheikh Balakazi pointed to several countries where Islamic banking operates alongside conventional banking as examples Zimbabwe could draw lessons from.
He cited South Africa, Kenya, Ghana, Nigeria, Germany, Uganda, the United Kingdom, and America, among others, saying these jurisdictions demonstrated that Islamic financial products could coexist with conventional banking.
The proposed model, therefore, would not necessarily require Zimbabwe to abandon its existing banking system.
Instead, Islamic banking could be introduced as an alternative financial intermediation model, allowing customers to choose products according to their financial needs, beliefs, and preferences.
The call comes at a time when Zimbabwe is seeking to deepen financial inclusion, mobilize domestic savings, and attract fresh investment to accelerate economic growth.
For ZIMNZAF, the Islamic Banking Indaba represents the beginning of a broader conversation between the government, regulators, financial institutions, religious organizations, investors, and other stakeholders on how interest-free finance can be incorporated into Zimbabwe’s financial architecture.
Sheikh Balakazi added that the ultimate objective should be to create an inclusive financial environment that provides opportunities to all citizens while strengthening Zimbabwe’s capacity to mobilize resources for national development.
“Islamic banking offers solutions” to some of the barriers within the existing financial system, he said, urging stakeholders to consider the proposal within the broader national objective of building an inclusive and productive economy.
