Ahmad Ali wrote:

Salam Alaikum Wa Rahmatuallah!

We a group of 4 people have acquired the 1.2 acre land in Loni (Ghaziabad) Delhi- NCR near Delhi-Baghpat-Saharanpur Highway, opposite to the main Tronica City ( A UPSIDC project) to open an school to provide education in Islam and Modern Curriculum at the highest possible standards in an Islamic environment suitable for all children irrespective of their background or origin, at a tuition fee rate that is both affordable to any family irrespective of its financial circumstances and viable in relation to these objectives; and in so doing, ensuring that the Islamic nature of the School takes precedence over all other considerations.

Islamic LoansNow we are in the need of 4 crores to start the construction of the school building and looking for interest free loan from islamic banking or any other ogranization. Please let me know the possibility or process to obtain the required loan.

Looking forward to get the positive & swift reply.

Kind Regards,
Ahmad Ali

Answer:

Wa Alaikum as Salam wa Rahmatullah,

Islamic banking has been prohibited in India for a long time. The Reserve Bank of India does not allow an Islamic commercial bank to function in India. So, no official interest-free banking exists, except for education (for scheduled caste and scheduled tribe) and for sugar industries (at present due to the crisis in sugar industries). Unofficially, there are a few small non banking institutions which offer deposit schemes but I am not sure about a load of Rs. 40,000,000. That is a huge amount and I don’t think any unofficial body will afford to provide it.

In Kerala, an Islamic non-banking financial company is in the process of establishment. They were approved last year and may take some time to start functioning. I am not aware of such institutions of initiatives in Delhi, you could contact the Muslim Education Trust to see if they offer loans; it is an initiative of Islamic Development Bank of Saudi Arabia. You could also check with the Muslim Fund Trust in Sujapur, West Bengal.

You could also consider approaching local Islamic organizations in Delhi called Jamaat or Jameeat and look for possibilities. Chances are very low due to the absence of official Islamic banking in India, but you could try.