This article delves into the basic principles governing Islamic banking and the rules and regulations under which such banking should operate. Shari`a precepts and socioeconomic objectives are key to Islamic banking.
This article examines the process of privatization in Islamic countries. It studies the benefits privatization holds for the countries and their people and also the role of Islamic banks in the privatization process. More and more nations are understanding the benefits of private enterprise. It realizes liquid financial assets and also enables optimum utilization of resources. Privatization not only holds the great promise of attracting foreign capital and technology but also the return of home funds and entrepreneurs.
This article studies the role of Islamic financial Institutions historically and in the emerging scenario - the changes that have taken place and the need to look to the future with confidence. It describes the various Islamic financial products, their working and also the future area for consideration.
The term riba can be applied to practices fitting in two general categories--first,
In this special issue, the following sub articles are included: Modern banking with traditional values (an ancient faith has spawned sophisticated banking); Ancient wisdom, modern method (explaining the vocabulary of Islamic financial transactions); An interview with Prince Mohamed Al Faisal Al Saud (modern technology enables us to meet our client's needs); An interview with Sheikh Saleh Kamel (
Although Islamic banking was hardly practiced at all one generation ago, the industry is today one with assets of over $20 billion. Islamic banking is an international movement, with much geographic diversity. Islamic banks utilize profit and loss sharing rather than dealing with interest. Interest is banned in al-
While the names of Islamic financial practices are not well-known in the West, the ideas behind Islamic finance tools are not so complex. Murabahas are commercial finance set-ups. In this most common Islamic arrangement, the lender purchases something, takes possession of it, and sells it later to the borrower for a profit. The lender has taken the risk of the goods' devaluation. Ijara transactions are leasing and hire-purchase deals.
HRH Prince Mohamed Al-Faisal Al-Saud, the American-educated son of Saudi Arabia's late King Faisal, founded the Dar al-Maal al-Islami (DMI) in 1981. The organization is a banking group administered in Geneva. There are a number of offshoots and affiliates of DMI widely geographically spread. Al-Saud states that his Western education aided him in fleshing out his thinking. He cites his father as his primary influence. Initially, he reports, the idea of Islamic economics was not taken seriously by conventional experts. There is, in history, an Islamic economic model to be emulated.
Sheikh Saleh Kamel, president of the Dallah AlBaraka group, also serves on the board of a research center at King Abdulaziz University named after Saleh Abdullah Kamel. The AlBaraka president previously held a post at the Saudi finance ministry. The group he heads holds 38 major world companies. While the ban on interest is often the most popularly identifiable feature of Islamic banking, the religion, Kamel explains, offers a full economic outlook. Zaka, the taxes and alms system, is one that could help end recession, unemployment, and inflation in the modern economic framework.
The first modern Islamic bank was founded in Egypt's northern delta region in 1963. The Mit Shamr Savings Bank gave out interest-free loans for efforts whose implementation were good for the society. With the increase in oil wealth amongst OPEC countries in the mid 1970's, the spirit of Islamic economics flourished. The Islamic Development Bank, an organizastion that now has 45 member states, was born out of efforts undertaken at a 1973 meeting of