Full Speech: Jaiz Bank Executive Director at Hajj Stakeholders’ Summit, Abuja

• What we currently run in Nigeria is not a true hajj savings scheme. A proper savings model is one that builds wealth steadily over a medium or long term. In contrast, our scheme largely starts building up six months before Hajj, a short-term model with minimal investment opportunity.

• Hajj Saving Scheme: We lag behind 

Topic: Sustainable Hajj Financing Models and Benchmarking Successful Global Best Practices. Delivered by Alhassan Abdulkarim the Executive Director, Jaiz Bank Plc.

Assalamu alaikum wa rahmatullah.
I would like to speak by providing some perspective regarding sustainable Hajj financing, particularly the Hajj Savings Scheme.

To begin, Nigeria is the most populous country in Africa, with over 200 million people of which we believe nearly half are Muslims. We also have one of the highest Hajj allocations in the world, averaging about 90,000 slots annually. At approximately 60% utilisation of this allocation, Nigeria spends over ₦300 billion on Hajj every year. But the question is: how is this money generated?

This enormous sum begins to accumulate only about six months before the Hajj season. Often, intending pilgrims sell properties, deplete their bank accounts, or gather money from family savings. Unfortunately, there is no established culture of long-term savings for Hajj.

Let me speak briefly about the Hajj Savings Scheme that Jaiz Bank manages on behalf of the National Hajj Commission. From 2021, up to the end of last year’s Hajj, we have only been able to collect about ₦49 billion in total over five years. That’s roughly ₦9.8 billion per year, merely 3% of the total annual Hajj expenditure.

Even more striking, with an estimated 20 to 30 million Nigerian Muslims eligible for Hajj, only 27,000 Hajj savings accounts have been opened in five years. That’s a staggering gap.

To compound this challenge, account opening and collection is usually suspended during the active Hajj season. Once Hajj concludes, we reopen the portal maybe two or three months later. This means that for almost six months, there’s little or no collection, resulting in an average account balance of just ₦2 billion at any given time. Compare that to the actual annual Hajj expenditure, which now exceeds ₦400 billion. Clearly, there is a significant gap and opportunity.

Now, let’s look at successful models. The keynote speaker has already referenced Malaysia, Indonesia, Pakistan, and Turkey. To illustrate: in Malaysia, two years ago, all pilgrims received a 25% subsidy from Tabung Haji. That is, if Hajj cost $5,000, the individual only paid $3,500—the remainder came from profit generated through their savings.

What we currently run in Nigeria is not a true Hajj savings scheme. A proper savings model is one that builds wealth steadily over a medium or long term. In contrast, our scheme largely starts building up six months before Hajj, a short-term model with minimal investment opportunity.

How do we change this?

First, we must instil a culture of saving among Muslims in Nigeria. Many do not believe they can plan for Hajj in 5, 10, or 15 years. We must encourage them to think long-term and trust the system.

Again, let’s go back to Malaysia. Though I don’t have their exact population figure, by the end of 2024, over 9 million active subscribers were contributing to Tabung Haji. These are people still on the queue, not those who have already performed Hajj. Their collective deposit was equivalent to ₦28 trillion. For comparison, our deposits here amount to just ₦2 billion.

As for returns, Malaysia generates hundreds of billions of naira in profit annually. These returns fund their subsidy model. They are able to achieve this because their funds are invested in halal ventures, real estate, commodity trading, Islamic money markets, exports and so on.

In contrast, our savings remain short-term, limiting investment opportunities and returns. Over five years, our total profit was just over ₦1 billion, a drop in the ocean compared to what is possible.

To improve, we must:

1. Foster long-term savings culture.

2. Allow investment in naira-backed and dollar-yielding instruments to hedge against forex volatility.

3. Leverage strategic international partnerships.

The Islamic Development Bank (IsDB), through its Islamic Corporation for the Development of the Private Sector (ICD), assists countries in booking accommodations and other logistics. Countries like Malaysia return to Saudi Arabia immediately after Hajj, during Muharram, to secure hotels for the next year. IsDB offers guarantees and even provides advance payments, allowing for up to 50% discounts.

They extend similar arrangements to airlines. This early planning and structured finance is why Hajj is more affordable for them. For Nigeria, we often begin planning just three to six months before departure—when prices have peaked. That must change.

Finally, we must renew our Iman (faith) and believe that Hajj is possible for every Muslim—with patience, planning, and proper financial tools. Assalamu alaikum wa rahmatullah. Thank you very much.

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