Challenges and Opportunities of Interest Free Banking Services (A Case Study of Dashen Bank Wolkite Branch

Abstract

Ethiopia accommodate Islamic financial system through interest free banking window in 2011 and full- fledged interest free banking by the end of 2019.Financial institution refers to an establishment those focuses on leading with financial transaction. Bank is a part of those institutions which accept deposit from economic agents and then on lend this fund to make direct loans or invest in security, stocks and bonds. Interest free banking derived from Islamic word, it is fundamental concept it operates primitive professional and ethical investing while elimination of interest in all its forms is an important future of the Islamic financial system, form of ethical investing and ethical lending except or that no loans are possible unless they are interest free. The objective that establishment of interest free banking is important for development of investment and saving to make positive contribution to the fulfillment of socioeconomic development of society. For the sake of obtaining sufficient data the researcher used both primary data and secondary data. The primary data was gathered through questioner and also interview to collect primary data.