islamic banking and finance

 islamic bank and finance Essay

п»їIslamic banking and finance

An alternative form of financial which challenges the traditional western norms and addresses this limits. But it shouldn't really be considered a norm just because it is created in the West, depending on capitalist suggestions. Other forms of banking including IBF had been around for many years' specifically Islamic countries but merely ignored by economic geographers as they were in the global South. It is not an вЂemerging' method; it is successful in lots of Middle Eastern and Parts of asia wher IBF is the tradition. Economic geographers fail to realise the fact that their financial theories happen to be developed inside the North and don't travel (Olds 2001). IBF vs . The mainstream

The traditional western economy is one which can be exploitative. It turns money into a item though charging people for borrowing (loans) in order to make money. This is risky because the poorest are usually those people which will have to borrow and could not be able to shell out the banking institutions back which can be what cause the recession 2007/8. Pay day loan companies such as Wonga. com charge this sort of high interest levels that consumers often wrap up paying much more than they took out in the first place. When compared, Islamic banking institutions see funds as a true thing. This form of bank is a way that non-western economies can вЂtheorise back' Yeung 2007 to the traditional western norms of economic location from an Asian point of view rather than Eurocentric. Better to identify it as a diverse economic system rather than alternative/emerging within a mostly capitalist program as it draws upon distinct ideas, know-how and strategies. (Pollard and Samers 2007) What is Islamic banking?

This can be a fairer means of lending since the teachings of Shariah law state not allowed to charge curiosity and risks are assessed more rigorously so there may be less potential for people defaulting. Riba (interest) вЂ“ Muslims do not believe in gaining curiosity as it is unfair/unjust to build an income at another person's expense. Gharar (risk) вЂ“ this should be...