Sunday 17th September, 2006


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President of the Manzil Co-operative Society Ltd board of directors Isa Jerome Chambers.
Photo: Lester Forde


Imagine being able to buy your own home without the burden of paying interest rates or a mortgage loan.

Interest-free home and property ownership is exactly what T&T’s newest co-operative, Manzil Co-operative Society Ltd, seeks to offer its members.

The Manzil home acquisition plan is based on a declining balance approach which places the buyer and the co-operative as co-owners on the property. Under the terms of the programme, the buyer does not repay an interest-bearing loan.

President of the fledgling co-operative, Isa Jerome Chambers, said the organisation is based on the tenets of Sharia, or Islamic religious law derived from the Qur’an.

“The idea for Manzil came out of a need for the provision of Sharia-compliant financing in the area of property development,” said Chambers on Thursday during an interview at the co-operative’s Santa Maria Plaza, Mucurapo Road, St James, office.

He also stressed that Manzil, registered as a co-operative in December 2005, is not a “fly-by-night concept,” or a front for any radical Muslim group.

So worried was he about the latter, Charles, a Muslim of African descent, revealed that he was hesitant about accepting the post of president.

“It is firstly an Islamic financial institution,” Chambers said.

What this means is charging interest, or riba, is not permitted.

Chambers said Manzil is an alternative for Muslims interested in property and land development, but without the obstacle of riba.

The Qur’an, he explained, states that engaging in usury—the collection or payment of interest—is prohibited.

“If the Qur’an says stay away from riba, do not deal in it, nor take, nor give; the choice is clear,” he said.

Chambers said this is the biggest difference between Manzil and other co-operatives.

But if the co-operative will not charge interest, how is the company to make money?

According to Chambers, Manzil’s profit lies in trade.

“For now, we are concentrating on buy-and-sell transactions, as opposed to going through the financing process,” he said.

Chambers explained that unlike other banks, which loan a prospective buyer money, in Islamic mortgage transactions, the institution purchases the property.

The financial institution then re-sells the property to the buyer at a profit, while allowing the purchaser to pay in instalments.

During the stipulated payment period, both parties will be co-owners with the buyer having the option to purchase the co-operative’s share in the property.

Because this type of commerce is based on Islamic laws, there are no penalties to the buyer for late payments.

Chambers also said if a member encounters problems in making payments repossession is not automatic.

“If a person is unable to afford to pay, the majority share holder can sell the property at market value,” explained Chambers, who has worked out of the office of the Commissioner of Co-operatives for the past 15 years.

And even then, said Manzil’s treasurer Wayne Herbert, the co-operative can only recover what it is owed and the member is refunded their initial investment.

But repossession, said Chambers, is extreme, because in most cases, allowances would be made for persons in financial difficulty.

“In all these agreements, we are relying on the person to behave like a good Muslim,” said Chambers.

Which brings us to another major issue.

Membership in Manzil is only available to Muslims—of good character.

“The whole entity is really there for the welfare of the Muslim community, to provide one of the basic requirements for man and that is a home,” said Chambers.

As part of their commitment Manzil has a Sharia board, consisting of Islamic scholars, including Mufti Waseem Khan and Sheik Yusuf Talal De Lorenzo (member of the Canadian Islamic Bank and Dow Jones Company Sharia board).

“A Sharia board is a requirement for Islamic financial institutions,” said Chambers. “The management has a commitment to pay attention to what the Sharia board has to say.”

The board ensures all investments comply with Islamic law.

Islamic financial organisations are forbidden to invest in businesses engaged in the production, or trade, of alcohol, pork, gambling and un-Islamic media, like pornography.

“We must ensure that everything complies (with Sharia) because it is easy to slip into interest in a capitalist society,” said Chambers.

The September 2, launch of Manzil at Rasam Restaurant, City of Grand Bazaar, Valsayn, signalled the co-operative’s readiness to enter the real estate business.

Although the membership now stands at 65, Chambers said because of the unique service Manzil offers this number is expected to grow at a rapid rate.

“Property development is one of our long-term projects. We are not trying to make gated Muslim communities, but we are creating homes for the general public,” said Herbert.

Bheemal Ramroop, Commissioner of Co-operatives at the Ministry of Labour, who attended the launch, wished Manzil’s new board success, but issued a note of caution.

“Be constantly vigilant. We’ve had organisations with intentions of getting into housing, but they have not delivered based on the expectations of members,” he said. “We have societies getting into this area without doing research and in their enthusiasm to get ahead sought to purchase property without realising they could not get the proper approvals and now the land is of no use to members,” Ramroop added.

In challenging the board of directors to ensure accountability and transparency in all its’ dealings, Ramroop said Manzil’s venture was a much needed service, particularly with the escalating cost of housing and real estate.

Kwesi Atiba, of the Islamic Resource Society, also offered the fledgling co-operative words of encouragement and commended the board for taking up the challenge to provide affordable housing in T&T.

Also addressing the gathering was Yacoob Ali, president general of the Anjumaan Sunaat Ul Jamaat Association.

“Poverty and deprivation affects the mass of Muslim people in the Diaspora, organisations like these help look after our brothers and show we are a people who care .” he said.

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