A suggestion to set up financial institutions based on the ideology  of Islamic banking to attract interest free deposits from Non Resident Keralites is being considered by the Kerala government, finance minister T M Thomas Isaac said.

The consultant appointed to study the feasibility of such financial institutions in the state has already given a go ahead to the proposal, he said.

“The banking institutions will not give interest to depositors and will not take interest from borrowers,” he said. The investment would be used to set up industrial ventures and infrastructure projects and the profit from such ventures will given to the depositors.

He said there are many Financial institutions based on Islamic banking principles are operating in several parts of the world.

A Promoters’ Committee had been formed at a meeting held here on July 15 to study the proposal and they will meet again on August 12th at Calicut  to give final shape to the proposal, he added.