Insights
Data Republic website
Published
Share
Share on facebook
Share on twitter
Share on linkedin
Share on email

Temenos: leader in core banking and cultural expansion

Temenos continues to showcase its adaptability and diversity as it has been chosen by  Saudi Arabia’s second largest bank, Al Rajhi Bank, to provide a complete renovation of their core banking technology. This comes a matter of months after adding Australian challenger bank Volt, Tunisia’s  Banque de l’Habitat, and Libya’s Alejma’a Alarabi Bank to their host of pan-European clients. 

Al Rajhi Bank is expected to leverage Temenos’ banking solutions to introduce new lending products to the market and service its growing number of customers more quickly and efficiently. As the Saudi bank also happens to be the worlds largest Islamic bank, the partnership is also set to enhance their Sharia-compliant lending and financing product capabilities. Whilst Temenos is accustomed to partnering with Islamic financial services providers, already servicing 19 clients in Saudi Arabia, there is a fundamental gap to be bridged between modern financial services and intrinsic Islamic values.

Amongst many differences, the main divergences are:

  • Sharia law prohibits riba; earning interest from what is considered a measure of value (money), as this is considered usurious or exploitative. Whereas ‘Western’ lending relies on a predetermined rate of return (interest).
  • Sharia law prohibits qimar; translated to betting, this disables the use of speculative investments where there is an ascertainable ‘winner’ and ‘loser’. Whereas a common ‘Western’ investment vehicle is a future.
  • Sharia law prohibits gharar; the incurrence of excessive risk, which is thought to extend to the sale of items whose existence isn’t certain. This may extend to ‘Western’ insurance and/or derivatives based on outcomes that may/may not occur.
  • The trade in certain industries is also prohibited under Sharia law such as the tobacco, alcohol and pork industries.

Their Managing Director Middle East & Africa, Jean-Paul Mergeai reinforcing their commitment to adapting to cultural standards across the globe by elaborating:

“Our agreement with Al Rajhi Bank demonstrates our commitment to working with the region’s leading banks to power innovation, growth and success through our market leading technology. Our business partnership with the world’s leading Islamic bank also demonstrates the excellence of our leading and multi award winning Islamic Banking Suite solution and our focus on delivering operational value and efficiency through digital technology to Islamic Finance.”

 

 

Share this Article
Share on facebook
Share on twitter
Share on linkedin
Share on email
Related Insights
Featured
Amsterdam Fintech Week
Take a look at our yearly fintech festival, Amsterdam FinTech Week. Go on the dedicated website to check out the 2021 wrap up!
AMLD5 Guide
A source for consulting PSD2 legislation coupled with commentary, tips & tricks, applicability, in collaboration with our member law firms.