Islamic Banking Dissertation Proposal

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The Islamic banking has increased in terms of branches, deposits, capital funds, sources. on the Western banking model; the latter being inconsistent with Islamic law primarily due to the disapproval of Riba (i. Riba in Hadith “Every loan that derives a benefit (to the creditor) is riba”. Abu said al Khudri Radi-Allahu Anhu narrated that Holy Prophet ( peace be upon him) said: “Gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt for salt, like for like, payment made hand by hand.

If anyone gives more or asks for more, he has dealt in Riba. If the creditor received a goat as mortgage from the debtor, the creditor may use its milk to the extent he has spent in providing fodder to the goat.

However, if the milk is more than the price of the fodder, the excess is riba. For Usamah ibn Zayd : “There is no riba except in nasi’ah (waiting).

“Bukhari, Kitab al-Buyu, Bab Bay al-dinari bi al-dinar nasa’an, ( : 386); also Muslim and Musnad Ahmad).

This Shari a’ board authorizes the products that whether these are Shari a’ compliant or not.

Islamic banking is the banking that is guided by Islamic law (Shari a’) principles and guided by Islamic economics.

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