Interview: Omar Barhamji, CEO, Al Baraka Bank Syria, on opportunities within the sharia-compliant segment, and strategies to promote financial literacy and long-term investment
How do you assess the evolving demand for Islamic financing in reconstruction-linked sectors?
OMAR BARHAMJI: Reconstruction is increasing demand for sharia-compliant finance. Asset-backed instruments including murabaha (cost-plus financing), istisna’a (deferred delivery), al salam (forward-sale contract) and musharakah (joint venture) suit reconstruction needs. As investment partners as well as lenders, Islamic institutions can mobilise capital from domestic savers, Syrians abroad and investors who prefer sharia-compliant modalities. The lifting of broad economic sanctions and the progressive reopening of international banking channels have notably eased financial barriers to reconstruction, helping to strengthen investor confidence and encourage greater liquidity flows into the economy.
Where do you see opportunities for expanding Islamic retail-banking products with rising mobile-banking usage and low financial inclusion?
BARHAMJI: Financial inclusion remains constrained by conflict, limited branch presence and a reliance on cash, particularly among lower-income households. Rising smartphone penetration and the digital familiarity of younger Syrians open avenues for expanding Islamic retail offerings. Digital onboarding and mobile accounts reduce the need for branch visits and make payments, transfers and basic financial services accessible to underserved areas. Adoption trends are encouraging – digital-account usage has grown, with new customers in some periods doubling earlier growth patterns.
To what extent can Islamic financing structures be adapted to serve small and medium-sized enterprises (SMEs) restarting operations?
BARHAMJI: Islamic financing can be effectively tailored to SMEs and family businesses, many of which lack formal records but are re-entering the market with strong repayment intent. Since 2018 pilots in Islamic microand SME finance have shown exceptional repayment performance – even in rural areas – when group guarantees, shared accountability and local knowledge are incorporated. For many borrowers, small-ticket financing is essential to livelihood recovery, reinforcing repayment discipline. Collection ratios have exceeded 99%, demonstrating both practicality and social impact.
Which strategies should financial service providers adopt to deepen domestic savings and mobilise long-term Islamic investment accounts?
BARHAMJI: Lenders need to expand the range of sharia-compliant savings and investment tools to attract liquidity held in cash. Syria’s limited suite of Islamic savings products constrains the mobilisation of longterm funds. Years of inflation have eroded bank capital, suggesting that recapitalisation may be necessary to rebuild confidence and strengthen balance sheets. Nonetheless, domestic liquidity is substantial, and households tend to favour saving over borrowing. With greater trust in the banking system and suitable Islamic savings vehicles, much of this capital could re-enter formal channels. Financial literacy efforts, transparent account management and predictable profit-sharing structures further support mobilisation.
What policy or regulatory developments would most accelerate the growth of Islamic banking?
BARHAMJI: With broad economic sanctions lifted and new international banking channels now operational, the priority is to translate financial connectivity into investment and wider access to sharia-compliant financing. These channels facilitate cross-border payments and the mobilisation of international capital. Regulatory priorities include introducing Islamic capital-market instruments to finance reconstruction and provide credible long-term savings products. Updating sharia-governance frameworks, modernising commercial laws and establishing clear rules for Islamic microfinance would further strengthen the sector.
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