A separate regulatory framework for Islamic financial institutions has been proposed by the Kenya’s financial regulator to boost the country’s capital markets.
Early this year, the regulator circulated a draft of the strategy and the plan is now in its final stages of preparation, according to a Reuters report.
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The new frameworks are aimed at promote more advanced financial services in Kenya such as asset management, venture capital, private placements and Islamic finance.
"It will be launched in coming weeks," a spokesman for Kenya’s Capital Market Authority (CMA) told Reuters.
According to the publication, CMA plans to create a regulatory framework of its own for Islamic capital markets in the short term, which will focus on corporate governance, information disclosure, a policyholder compensation fund and responsible pricing.
However, in the long term the CMA plans to engage the central bank and national Treasury to develop a separate policy, legislative and regulatory framework for Islamic finance.
The regulator also aims to create and offer legal recognition to a single national sharia advisory board to set rules and policies for the entire industry, which will mirror regulation in countries such as Malaysia and Oman.
