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Islamic Banking and Finance, becoming part of new culture in financial revolution.



Islamic finance is growing faster than regular equivalents in certain markets and is even being adopted by many non-muslim clients. Islamic finance assets are worth around 2.2 trillion dollars worldwide and are set to hit nearly four trillions by 2022.


Islamic finance is different from conventional finance in many ways but the theme is the differences in the prohibition on charging or receiving interest and the prohibition against excessive speculations. The way that these two prohibitions play out is mostly in the documentation and what theses prohibition is based on. The concern against having excessive leverage in the system, prohibition of interest is based on and the potential or the create financial crisis by overly speculative behaviour is what the second prohibition is based on.


Products and Outcome

The financial outcome is the same as for conventional finance but the form is different. For example, If a client wants to have home finance, to buy a house, the end result that they own the home through a financier. Financing some kind will be the same, where variations can be found on the process of getting there.



In a conventional mortgage, money would be lent and get a mortgage with property. But in Islamic financing, the client would buy a house, lease it for over the period and own it in the end. Islamic financial concept espouses on interests in social concerns. More involvement in socially responsible investments and gree principles, excluding investments and financial participation in dealing with social sins and sin stocks like tobacco, gambling, arms manufacturing, pornography and so on.. which is seen as the convergences in the values and ethical investing which a lot of people want to get into.


Direct investment mentioned in an article of association, or in any interest-bearing activity is prohibited, also indirect investments as well are frowned upon but may not necessarily be prohibited.