This action might not be possible to undo. Are you sure you want to continue?
banking is that Islamic teaching says that money itself has no intrinsic value, and forbids people from profiting by lending it, without accepting a level of risk – in other words, interest (known as "riba") cannot be charged. To make money from money is prohibited – wealth can only be generated through legitimate trade and investment. Any gain relating to this trading are shared between the person providing the capital and the person providing the expertise. At Islamic Bank of Britain, we generate all our profit through sharia’a compliant trading and investment activities. We then share the profits with our customers at a pre-agreed ratio. In order to share profits you must hold one of our savings or investment accounts There are two major difference between Islamic Banking and Conventional Banking: 1. Conventional banking practices are concerned with "elimination of risk" where as Islamic banks "bear the risk" when involve in any transaction.
some say it can only be considered on gold and silver. While the basics of what the business is are the same.2. is not interest. the term refers to operating the business within Islamic law... Getting out any benefit without bearing its liability is declared Haram in Islam.. When Conventional banks involve in transaction with consumer they do not take the liability only get the benefit from consumer in form of interest whereas Islamic banks bear all the liability when involve in transaction with consumer. Like in all religious things. Certainly a problem in modern banking! 10 Islamic Banking Vs Conventional Banking However.. what is considered to be interest has different definitions by different Islamic scholars.but paying back the same weight as you borrowed (the same weight of paper money for example). The main thing that effects this business under that law is that Islam prohibits the charging of interest. there would seem to be .
FT Listed.com Ads by Google . Banks. IT. Scholarships + Visa Support www..some conflict and differences between followers that may seem strange to outsiders.hsbc..LSBF.) www. • • • • Login Sign Up | Log In þÿ þÿ / 17 Download this Document for Free Ads by Google A New Job in the UAE? You'll Need A Bank Account Use HSBC's International Services www. modern Islamic banking may take many forms.islamicfinancenavigator.uk/MSc-Banking Islamic Finance Navigator World premier Islamic finance directory (Advisors.ae MSc in Banking&Securities Top Financial Masters Degree. So basically. Academics... each of which strives to adhere to it's understanding of Islamic l Scribd • • Explore Community Upload a Document þÿ Search Books.org. Presentations. Business.
PacNetServices.. Islamic finance has been gaining momentum on a global scale for the last 30 years. In particular. and are driven by a global trend amongst Muslims to become more observant of their faith. Islamic financial institutions. The instruments used by them. have 2 . Many Islamic Banks have sprung up over the last few years. Industry size is currently estimated at more than $400 billion. It might have been the reason why Islamic Banking emerged. Islamic law prohibits investing in businesses that are considered unlawful. Today. These changes are occurring both in Muslim and in western countries. Banks. also commonly called riba. Besides individual financial institutions operating in many countries. or haraam.islamicfinancenavigator. Islamic law prohibits usury. the collection and payment of interest. today Islamic Banking is sought by Muslims and non-Muslims due to the benefits it offers. Generally.. IT.com Check 21 Processing Accept Electronic Checks Safest Solution for Your Business www. In addition. in one form or the other.Islamic Finance Navigator World premier Islamic finance directory (Advisors.com Islamic Banking Vs Conventional Banking ISLAMIC BANKING Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia’h) principles and guided by Islamic economics. with projected growth of 15% per annum.) www. are working in about 75 countries of the world. Financial institutions around the globe are trying to keep pace with the growing demand for Sharia’h compliant products and services. Islamic law also prohibits trading in financial risk (which is seen as a form of gambling). efforts have been underway to implement Islamic banking on a country wide and comprehensive basis in a number of countries. both on assets and liabilities sides. Islamic Banking Global Scenario Over the last three decades Islamic banking and finance has developed into a full-fledged system and discipline reportedly growing at the rate of 15percent per annum. however.
In Sudan. Like other Islamic banks around the world the banks in Sudan have been relying in the past on Murabaha financing. the share of Musharaka and Mudaraba operations is on increase and presently constitutes about 40 percent of total bank financing. However. there are some conceptual differences in interpretation and Shariah position of various contracts like sale and purchase of debt instruments and grant of gifts on savings and financial papers.Islamic Banking Vs Conventional Banking developed significantly and therefore. a system of Islamic banking and finance is in operation at national level. Further. the BMA has pioneered a range of innovations designed to broaden the depth of Islamic financial markets and to provide Islamic institutions with wider opportunities to manage their liquidity. The share of Islamic banking operations in Malaysia has grown from a nil in 1983 to above 8 percent of total financial system in 2003. the BMA has introduced a comprehensive prudential and reporting framework that is industryspecific to the concept of Islamic banking and finance. However. offshore banking and funds management. they are also participating in the money and capital market transactions. In Malaysia. is hosting 26 Islamic financial institutions dealing in diversified activities including commercial banking. Bahrain with the largest concentration of Islamic financial institutions in the Middle East region. It pursues a dual banking system. Islamic banks and financial institutions are working parallel with the conventional system. investment banking. To provide appropriate regulatory set up. where Islamic banks operate in the environment in which Bahrain Monetary Agency (BMA) affords equal opportunities and treatment for Islamic banks as for conventional banks. Although the Islamic financial system has taken a good start in . Another country that has a visible existence of Islamic banking at comprehensive level is Malaysia where both conventional and Islamic banking systems are working in a competitive environment. Bahrain also hosts the newly created Liquidity Management Centre (LMC) and the International Islamic Financial Market (IIFM) to coordinate the operations of Islamic banks in the world. Bahrain and a few other countries of the Gulf. They have a plan to enhance this share to 20 percent by the year 2010.
Islamic banks now participate in a wide financing domain stretching from simple Shariah-compliant retail products to highly complex structured finance and large-scale project lending. Iran also switched over to Usury Free Banking at national 3 Islamic Banking Vs Conventional Banking level in March 1984. the refining of Islamic financing techniques and the huge requirement of infrastructure development in Muslim countries there has been a large number of project finance deals particularly in the Middle East region. The BMA has quite recently signed MoU with the London Metal Exchange (LME) to pool assets to develop and promote Shariah compliant tradable instruments for Islamic banking industry. travel accident insurance. water plants. In May 03. National Commercial Bank (NCB) of Saudi Arabia has introduced an Advance Card that has all the benefits of a regular credit card. However. include power stations. Owing to the growing amount of capital availability with Islamic banks. As such. roads. The establishment of the Prudential Information and Regulatory Framework for Islamic Banks (PIRI) by the BMA in conjunction with AAOIFI has gone a long way towards establishing a legal and regulatory framework to meet the specific risks inherent in Islamic financing structures. BMA has also finalized draft guidelines for issuance of Islamic bonds and securities from Bahrain. The card does not have a credit line and instead has a prepaid line. Bahrain is the leading centre for Islamic finance in the Middle East region. significant problems still remain to be addressed. bridges and other infrastructure projects. These projects. etc and no interest. the Liquidity Management Centre (LMC) launched its debut US$ 250 million Sukuk on behalf of the Government of Bahrain. Added benefits are purchase protection.Sudan. there are some conceptual differences between Islamic banking in Iran and the mainstream movement of Islamic banking and finance. The arrangement is seen as a major boost for industry’s integration in the global financial system and should set the pace for commoditytrading environment in Bahrain. Like Sudan. inter alia. no extra fees . it does not incur any interest.
Saudi Government has also endorsed an Islamic-based law to regulate the kingdom's lucrative Takaful sector and opened it for foreign investors. it is a contract of sale in which the seller declares his cost and profit. self employed and small establishment employees who sometimes do not meet the strict requirements of a regular credit card facility. A dedicated high court has been set up to handle Islamic banking and finance cases. The Financial Sector Master plan maps out the liberalisation of Malaysia's banking and insurance industry in three phases during the next decade. 4 Islamic Banking Vs Conventional Banking Islamic banks have also built a strong presence in Malaysia. easy to load up and has worldwide acceptance. the Financial Services Authority is in final stages of issuing its first ever Islamic banking license to the proposed Islamic Bank of Britain. It lists incentives to develop the Islamic financial sector and enlarge its market share to 20 percent. MODES OF ISLAMIC FINANCE MURABAHA Literally it means a sale on mutually agreed profit. youth. Islamic banks have adopted this as a mode of financing. it involves a request by the client to the bank to purchase . from under 10 percent now. where Standard & Poor's assigned a BBB+ rating to the $600 million Shariacompliant trust certificates (called sukuk) issued by Malaysia Global Sukuk Inc. It is more secure than cash. This prepaid card facility is especially attractive to women. As a financing technique. which has been sponsored by Gulf and UK investors. In United Kingdom. the card is fully Shariah compliant. an eminent economist/expert on Islamic banking to advise the US Treasury and Government departments on Islamic finance in June 2004. Bank Negara Malaysia (BNM) has announced to issue new Islamic Bank licences to foreign players. Technically. Mahmoud El Gamal. The United States of America has appointed Dr.with no conditions.
IJARAH-WAL-IQTINA A contract under which an Islamic bank provides equipment. MUSAWAMAH Musawamah is a general and regular kind of sale in which price of the . but not necessarily required to do so. The undertaking or the promise does not become an integral part of the lease contract to make it conditional. All providers of capital are entitled to participate in management. The rentals as well as the purchase price are fixed in such manner that the bank gets back its principal sum along with profit over the period of lease. the ownership in the asset would be transferred to the lessee. while the loss is borne by each partner strictly in proportion to respective capital contributions. Ijarah or leasing is the transfer of usufruct for a consideration which is rent in case of hiring of assets or things and wage in case of hiring of persons. The profit is distributed among the partners in pre-agreed ratios. 5 Islamic Banking Vs Conventional Banking IJARAH Ijarah is a contract of a known and proposed usufruct against a specified and lawful return or consideration for the service or return for the benefit proposed to be taken. or for the effort or work proposed to be expended. In other words. It is an agreement under which the Islamic bank provides funds. which is stipulated in advance. The bank does that for a definite profit over the cost. which are mixed with the funds of the business enterprise and others. building or other assets to the client against an agreed rental together with a unilateral undertaking by the bank or the client that at the end of the lease period.certain goods for him. MUSHARAKAH Musharakah means a relationship established under a contract by the mutual consent of the parties for sharing of profits and losses in the joint business.
faqureshi .099 Uploaded: 07/05/2009 Category: Research > Business & Economics Tags: islamic concepts conversional modern banking deposits fund charge (More) Rated: (4 Ratings) Download this Document for FreePrintMobileCollectionsReport Document This is a private document. Conventional Banking This document contain the information about Islamic Banking and Conventional Banking. 6 Ads by Google Islamic Banking vs. Reads: 27.commodity to be traded is bargained between seller and the buyer without any reference to the price paid or cost incurred by the former.
. join us twofour54.000 companies from 100 countries Use your own Shariah board rules IdealRatings.com Share & Embed þÿ Link / URL: Embed Size & Settings: • • • • Width: Height: þÿ Auto þÿ þÿ þÿ Start on page: Preview View: þÿ Related 1.Follow Ads by Google twofour54 Abu Dhabi building the Arab world’s broadcasting industry.visafreetravel. 76 p.com Screen Shariah equities 42.panamaoffshorecenter.com Offshore Cyprus Company registration. Competitive rates www.com/broadcasting Visa-free travel passport Slovakia part of EU Apply for EU citizenship www. Cyprus Prof service.pkcy.com Panama Offshore Center Panama Offshore & Foundation Panama Offshore Services-Bank Intro www.
Reads: 169 81 p. 13 p.History of Islamic Banking in Paki. Reads: 228 3. US Treasury: 08042006 OccasionalPa. Reads: 343 13 p.. Islamic Banking into Conventional . US Treasury: 08042006 OccasionalPa..... Progress and Growth of Islamic Ban.. 28 p... Finance Reads: 1031 2.. US Treasury: 08042006 OccasionalPa. Reads: 221 13 p.. Reads: 0 14 p.
Problems Faced by Isalmic Banks To... Islamic Banking Reads: 0 5. Reads: 851 10 p. 1 Islamic Banking Reads: 0 253 p..Reads: 12298 28 p. 92 p. wp07175 Reads: 0 6 p. Challenges Facing Islamic Banking Reads: 4049 . 13 p.. Islamic Banking Problems and Prosp. Reads: 0 4.
. 3 p. Macro Economic Term Report .Islam. Financial System Reads: 620 7. 11 p.... Reads: 3917 24 p.83 p. Reads: 29 83 p.Home Professione. ...... Difference Between Running Finace . Reads: 711 6. Reads: 1586 4 p. Reads: 0 2 p. The Islamic Financial System as a . Der Übersetzer .. The Islamic Financial System as a .
. 3000xl Product Sheet Reads: 0 More from this user 1. An Overview of Computers and Progr. . 2 p. Department of Homeland . CREW: U.S. Reads: 0 8.. Reads: 0 1 p.. 10 p.North Hill Dental Center Reads: 0 28 p. 2 p. Present Perfect Tense Reads: 0 9.. Reopen Keynes Umbrella 081710 Reads: 0 1 p.
.. Islamic Banking vs Conventional. Challenges of Institutional Dev.119 Login to Add a Comment Submit Farhana Daud readcast this 1 day agoLearn more about Readcast.. . From: faqureshi Reads: 27. From: faqureshi Reads: 825 17 p.Glossary of Marketing Terms From: faqureshi Reads: 346 17 p..
shery92 readcast this 3 days agoLearn more about Readcast. Online & Blended Options www.Jasmina Ugarak Nuhanovic readcast this 1 day agoLearn more about Readcast. purikanika readcast this 2 days agoLearn more about Readcast. ayien21 readcast this 2 days agoLearn more about Readcast. Discover and connect with people of similar interests. Kapu Loko readcast this 2 days agoLearn more about Readcast.com Send me the Scribd Newsletter.ae/amanah Money Transfer Software World's only Free software system For banks & money transmitters www.uk/MSc-Islamic Open the world of possibilities in the UAE with HSBC Amanah Premier www.remitanywhere. and occasional account related communications.LSBF. innocentdreamss readcast this 2 days agoLearn more about Readcast. varp_aero readcast this 3 days agoLearn more about Readcast. . Soo Terk Jeng readcast this 2 days agoLearn more about Readcast. Ads by Google Islamic Finance Degree Top London Business School Full/Part.hsbc.org. rajendralera readcast this 3 days agoLearn more about Readcast.
Privacy Copyright Help & Tools • • • • Getting Started Community Guidelines Support & FAQ Web Stuff Partners • • • Partners Branded Reader Developers / API Subscribe to Us • • • On Scribd On Twitter On Facebook What's New • We have updated our Terms of Service .API Terms . Email address: þÿ Submit Upload a Document þÿ Search Books... Presentations.General Terms . Scribd • • • • • • Legal • • • • About Press Jobs Contact Blog Scribd Store Terms .Publish your documents quickly and easily. Academics. Share your reading interests on Scribd and social sites. Business.
in addition to its compliance with other regulatory requirements. further development of banking products is hindered. UNRESOLVED FIQH ISSUES Lack of standard financial contracts and products can be a cause of ambiguity and a source of dispute and cost. It is understandable that Sharia'h noncompliance entails a serious operational risk and can result in withdrawal of funds from and instability of an Islamic bank. institutional and tax framework is a basic requirement for establishing sound financial institutions and markets . without a common understanding of certain basic foundations. irrespective of its initial financial soundness. LEGAL FRAMEWORK An appropriate legal. In addition. Sharia'h compliance is hence a serious matter for an Islamic bank.• • Branded Reader Desktop Uploader Islamic Banking Issues HUMAN RESOURCE FOR SHARIA'H COMPLIANCE Users of Islamic financial services assign primary importance to Sharia'h compliance of the services they use.
This action might not be possible to undo. Are you sure you want to continue?