Non-interest banks account for just 1.7 per cent of Nigeria’s banking system despite more than a decade of regulatory backing and growing public interest in the sector, an expert has said.

Executive Director, South, of The Alternative Bank (AltBank), Korede Demola-Adeniyi, disclosed this during an interview on Islamic Finance Viewpoint.

According to her, the figure, based on 2024 data, reflects structural constraints within the sector, including weak public awareness, limited product innovation and persistent misconceptions about non-interest banking.

She said the model is often perceived as faith-based banking, rather than an ethical financial framework built on transparency, shared risk and financial inclusion.

Demola-Adeniyi observed that though non-interest banking recorded modest growth in 2025, it remains marginal within Nigeria’s largely interest-based financial system.

“Non-interest banking is not niche banking. It is ethical banking designed for inclusion. We are not selling to Muslims alone.”

We are offering a value proposition that works for everyone,” she said.

With increased capital and clearer regulation expected to shape the sector in the new year, Demola-Adeniyi expressed confidence that non-interest banks would assume a more prominent role in the country’s economic transformation.

According to her, AltBank’s growth strategy for 2026 would prioritise sectors with strong developmental impact, including healthcare, education, agriculture, renewable energy and transportation.