Customs and traditions are an integral part of Islamic finance as they reflect the practices and norms

of the community. In Islamic finance, customs are considered an important source of law as they
provide guidance on issues that are not explicitly addressed in the Quran or Sunnah. In this essay, we
will discuss the role of customs in Islamic finance and their importance as a source of law.

The Role of Customs in Islamic Finance

Customs are an important source of law in Islamic finance because they reflect the practices and
norms of the community. In Islamic finance, customs can provide guidance on issues that are not
explicitly addressed in the Quran or Sunnah. For example, customary practices can help determine
the standard of care required of a trustee or the types of investments that are considered
permissible. Customary practices can also help establish the market rate for certain financial
transactions, such as the price of gold or the profit margin for a murabaha transaction.

Customs can be defined as practices that have been accepted and followed by a community over a
period of time. In Islamic finance, customs are often referred to as "urf" or "adat." Urf refers to the
customs and practices that are followed by a community, while adat refers to the customary
practices that are followed by a particular tribe or group of people.

Customs are an important source of law in Islamic finance because they provide guidance on issues
that are not explicitly addressed in the Quran or Sunnah. For example, the Quran and Sunnah
provide guidelines on the types of investments that are considered permissible in Islam, but they do
not provide specific guidance on the types of investments that are considered permissible in Islamic
finance. Customs can help fill this gap by providing guidance on the types of investments that are
considered permissible in Islamic finance.

Customs can also help establish the market rate for certain financial transactions. For example, the
price of gold is often determined by the market rate, which is established based on the customs and
practices of the community. Similarly, the profit margin for a murabaha transaction is often
determined by the market rate, which is established based on the customs and practices of the
community.

Customs can also help ensure that Islamic finance is responsive to the needs of the community and
reflects the values and principles of Shariah. For example, customs can help ensure that Islamic
finance is socially responsible by promoting the welfare of the community and avoiding practices
that are harmful to society.

The Importance of Customs as a Source of Law in Islamic Finance

Customs are an important source of law in Islamic finance because they reflect the practices