Characteristics of Islamic Finance and Banking

As the world has recently passed by the global financial crisis that begun in 2008 in the USA with the banks collapsing, analysts ar giving several(predicate) opinions and devising virgin economic hypotheses close to the origin of, as s hale as the process of different countries escaped from the crisis. Among entirely these new theories, the case of Islāmic banks is lodge ining in terms of its nature and consequences. In my essay, I will find out to highlight the basic principles of the Islāmic finance, the reasons of the parapet of involution, the most important tools use by Moslem banks in economic activities and brief score of them, and finally my view item of the probable future progress of the Islāmic financial system.\nFirst of all, let us outline how Moslem banks genuinely work and what their main differences ar in similarity with conventional banks. In this banking system, banks argon operated by Islamic laws (known as Sharia), so Islāmic e conomic principles are considered as primary guidance. cardinal basic doctrines behind Islamic banking are the sharing of service and loss and, significantly, the prohibition of the array and passment of interest. Hence impertinent conventional commercial banks, Islamic banks do not even out or charge interest on lending or borrowing of money. Hence contrasted conventional commercial banks, Islamic banks do not pay or charge interest on lending or borrowing of money. This is because the Sharias strictly prohibits, among opposite things, the receipt and payment of riba. The interpretations to wrap up the meaning behind this limit suggests that earning or charging extra substance of money from debtor has to be seen something as immoral behavior, because making pressure on your borrower is actually unfair from the viewpoint of Islam. To wanton away it clear, the religion of Islam basically incite the principle of justice in the financial activities as well as in all other activities of an individual. Therefore...