Austria to launch first Islamic banking

A bank in Austria announced the launch of an Islamic banking system offering current accounts that will allow customers interest-free banking.

Vienna-based BAWAG P.S.K. said it will be piloting an Islamic current account in February to respond to the needs of different sections of society.

The accounts will not pay or charge any interest and will instead charge a fixed fee, Bawag's head of marketing Claudia Lemlihi said.

Customers will pay a fixed amount of €4.90, €11.90 and €34.90 per month for the account, debit card and overdraft facility.

The accounts, named Amana, have been specifically created for Muslims living in Austria, Lemlihi said.

“The new Amana account will be available from February 2, 2016,” the bank said in a statement.

The bank's decision has not come without criticism. Some critics said the move would give preferential treatment to Muslim customers but the Bank immediately denied the allegation and said anyone can open an Islamic bank account.

Since 1912, Islam has been Austria's second largest recognized religion, with an estimated 600,000 Muslims, mainly of Turkish and Bosnian origin, resident in the country.

The bank said in a statement on its Facebook page that everyone should respect the beliefs of all religious communities.

It also said that that bank's new initiative to launch the Amana current account is based on Austrian law.