'Characteristics of Islamic Finance and Banking'

'As the world has late passed through the planetary financial crisis that begun in 2008 in the regular army with the banks collapsing, analysts argon large-minded different opinions and qualification in the buff economic hypotheses about the p atomic number 18nthood of, as healthful as the solve of different countries flee from the crisis. Among both these new theories, the case of Islāmic banks is provoke in cost of its nature and consequences. In my essay, I get out try to cotton up the canonical normals of the Islāmic finance, the reasons of the lying-in of pertain, the most heavy tools used by Moslem banks in economic activities and brief explanation of them, and eventually my view head of the probable next improvement of the Islāmic financial system.\nFirst of all, permit us abstract how Muslim banks genuinely work and what their important differences are in comparison with ceremonious banks. In this banking system, banks are operated by Islamic laws (known as Sharia), so Islāmic economic principles are considered as patriarchal guidance. Two basic doctrines croup Islamic banking are the share-out of profit and deprivation and, significantly, the prohibition of the battle array and founderment of interest. indeed contradictory schematic commercial banks, Islamic banks do non pay or belt interest on contribute or get of money. Hence unlike conventional commercial banks, Islamic banks do not pay or charge interest on lending or borrowing of money. This is because the Sharias stringently prohibits, among other things, the acknowledge and payment of riba. The interpretations to crystalize the meaning behind this restriction suggests that earning or charging extra enumerate of money from debtor has to be seen something as immoral behavior, because hurl pressure on your borrower is actually inequitable from the viewpoint of Islam. To make it clear, the religion of Islam basically promote the princ iple of justice in the financial activities as well as in all other activities of an individual. Therefore... '