Where East meets West: Islamic finance techniques

There are presently more than 120 Islamic financial institutions world wide and deposit size is increasing, according to Adnan al-Bahar of the International Investor, at approximately 15% each year. As of yet, Pakistan and Iran have mandated that all banks operate by shari`a guidelines and other governments are thinking of legislating similarly. Two central principals of Islamic economics are described in the article--first that interest (riba) is banned in the Qur'an, and second that money is not a commodity but rather is a marker of value. Islamic financing practices have typically been short-term financing (particularly a London practice), money management, and high-cost purchase or leasing. Regulation and standard accounting practices need at present to be developed.