A Bahraini bank will launch the world’s first Islamic credit card by the end of the year, reported the Gulf Daily News on Tuesday.
ABC Islamic Bank, a subsidiary of Arab Banking Corporation (ABC), is hoping the card will generate $500 million worth of business in the initial stage, said the paper.
“The interest-free card will be issued by a new subsidiary, Islamic Credit Company (ICC), which is being incorporated in Bahrain with a capital of $300 million to $500 million,” said ABC Islamic Bank's deputy general manager, Mohammed BuQais.
The capital of the company is divided into two classes of shares.
Management, or Class A, shares, which represent the fixed capital owned by ABC Islamic Bank, are set at an authorized capital of $5 million and a paid-up capital of $3 million, he said.
Class B, or participation shares, will represent the variable capital traded between the investors.
The capital will be utilized only for settlement of credit card transactions, so there is no ceiling for the Class B category, he added.
“According to conservative estimates, we are expecting to generate business worth $500 million.”
This would be about 20 percent of the credit card business in the Middle East, he said – Albawaba.com
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