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Many Banks in Indonesia's Sharia-Ruled Aceh to Shut Conventional Operations — BenarNews


[Reuters]
Muslims in Indonesia’s Aceh province will be required to patronize Islamic financial services beginning next year, due to a local bylaw that has led several banks to shutter their traditional operations in the Sharia-ruled region, but one Muslim customer is suing to stop the trend.
Lawyer and activist Safaruddin said the closures hurt customers because Islamic banking doesn’t allow interest-bearing loans – unlike at conventional banks – and borrowed money has to be in the form of a trade or business agreement.
“There is not a single provision [in the bylaw] that conventional banks must close. That’s a misperception,” Safaruddin, who is suing three state-owned banks for stopping their traditional services in Aceh, told BenarNews. ....

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