After being immersed in the world of alternative economic
analysis for several years, it sometimes becomes easy to forget that most
people do not track forex markets, or debt to GDP ratio, or true unemployment,
or hunch over IMF white-papers highlighting subsections which expose the
trappings of the globalist ideology. Sometimes, you just assume the average
person knows what the heck you are talking about. This is, of course, a
mistake. However, it is a mistake that is borne from the inadequacy of our age
and our culture, and is not necessarily a product of weak character, either of
the analyst, or the casual reader.
Commenting on the article by Salman Sheikh below Islamic banks should also
learn to differentiate money lending from business risks. Islamic bank
leases assets and sells assets; they should manage business risks not
money lending risks which is the realm of conventional banking.
a cold hard look at term sheets and legal documents, an intelligent
Islamic banker will be able to identify the money lending risk
management clauses in there which should be remove if one does not want
to be labelled a money lender
The operative legal
maxim in Muamalat is Alghunm bi Alghurm. One is not entitled to reward
unless one is willing to expose oneself to risk. The Muamalat
practitioner who understands this Shariah injunction seeks risk to justify his
Risk is only ugly to riba bankers; Islamic bankers who wants to be Islamic Muamalat practitioners are required to seek risks as a matter of Shariah injunction.
Reflections on One Decade Operations of Islamic Banking in
Salman Ahmed Shaikh
Islamic banking in Pakistan roughly
started one decade ago and now there are 5 full-fledged Islamic banks in
Pakistan and more than 15 conventional banks that have Islamic banking
The industry has grown by more than 10
percent consistently during the last five years and despite the economic slump
after 2007 in economy, the growth in Islamic banking had remained consistent
and even gained more steam at least in Pakistan and that has been roughly the
case elsewhere too.
However, any meaningful assessment and reflection on the performance of Islamic
banking must take into account much more than the growth, market share, size of
balance sheet and profits.
Islamic financial institutions built their reputation and gained acceptance
from masses having promised socio-economic benefits of an egalitarian financial
system based on Islamic principles. Hence, this merits a careful analysis of
performance on these and similar parameters.
For what higher title do we carry than to be the Vice Regent of Allah on this earth?
" By time, verily Man is in loss except those who believe and do righteous deeds. And reminds one another with truth. And reminds one another with patience." Surah Al-'Asr.
"The person who utters a word which meets with God's favour may think it has not been heard, yet for this word, God will raise him to a higher level of Jannah. Conversely, the person who utters a word that stirs God's anger may give no thought to what he said, only to have God cast him in Hell for seventy years."
(Narrated by Malik and al-Tirmidhi, also by al-Nasa'i and Ibn Majah)
"Dear God You do not burden that I must but win, but You command that I must but try. Dear God count me amongst those who try. Verily my solah, my ibadah, my life and my death is only for You, Master of all Universe. Peace and aching salutations to the love of our life Muhammad s.a.w"
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Thesis download : "The Negative Impact of Riba Banking on the Performance of Islamic Banking in a Dual System"