The paper gives a general outline and an implementation plan for the establishment of Islamic Microfinance Institutions (MFIs). An evaluation of conventional microfinance institutions is followed by the delineation of an Islamic alternative. The theoretical part of the paper shows that there is great potential in Islamic MFIs that can cater to the needs of the poor.
The paper gives an introduction and brief history of microfinance, including Muhammad Yunus’s Grameen Bank. Then, several Islamic microfinance schemes are posited such as mudaraba,
Imitating the behavior of Western institutions is not necessarily the most beneficial strategy for an Islamic bank to adopt in its marketing. Muslims have different priorities and preferences, different criteria for making decisions, different goals, and different beliefs than do most individuals living outside the Islamic world. Those in charge of Islamic banks need to realize this. Bank managers, it is suggested, ought to utilize a model-based approach in order to study the macro- and micro-economical effects of their actions and their strategies.
The author primarily describes the basic practices that are undertaken by the Islamic finance industry. He cites an estimate of between $20 and $40 billion to be found in the international Islamic banking system today. The author notes that riba (interest) is forbidden in al-
Iran is unique in that it is the only country that has completely transformed its banking system into an Islamic one. In total, there are 45 countries in which Islamic banking is practiced to some degree, and the outside world is now keenly interested in the practices of Islamic finance for good reason. First, foreign companies that operate in
The article focuses on the Iranian economic rebuilding efforts in the wake of the war with Iraq. Regarding foreign loans, the nation's policy has been to accept foreign money as long as it is being put to use in sectors most crucial to the country's economy. According to the government, the high priority enterprises during this recovery are, to name a few, mining, metal manufacturing, and power plants. The foreign capital procured will primarily be applied toward the oil and gas industries.
At this point in time, the standard practice within Islamic finance houses is for each firm to maintain a shari`a board as part of the corporation. Each institution's board helps shape its policies and its practices in order to ensure that there is no breach of Islamic law.
While gold markets of the world such as London's and New York's have been somewhat quiet if not all together closed down, high interest rates and low inflationary expectations are drawing investors into the bond market and causing gold traders to anticipate little excitement in their field any time soon. One development of note regarding gold, however, has been the venture set up by Ibrahim Kamel called Dar Tadine al Umma (DTU).
The authors discuss the concept in social theory of social accounting, linking this idea to both Western thought and Islamic economics.
In an effort to draw oil money into Turkey, two Islamic banks have been founded. The banks are Saudi-funded and are called Faisal Finansman and Al Baraka Turkish Finance House. Both institutions are as of yet located solely in Istanbul. The official status of the two banks is that they are Special Finance Institutions (SFI's) and not subject to certain portions of the national banking laws. Faisal Finansman has financed projects valuing about $9 million already.