Are Islamic Banks Really Islamic????

expat_loyal

Councller (250+ posts)
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What is going on in this country is this true what is mentioned in this article link below?

Can someone confirm?? If yes than what is the status of all our accounts in Islamic banks and investment in Islamic mutual funds etc. Is state bank aware of all this??

Someone please confirm???
?

https://tribune.com.pk/story/2316748/islamic-banking-delivering-on-the-promise

The nation celebrated its 75th Independence Day with great fervour and while this is indeed an occasion to cherish and feel proud of but also calls for looking at what we have delivered so far on the promises we made at the time of creation of the first and only state on pure Islamic ideology.

The Islamic banking and financial system has gone through a transformational journey globally from the inception of the first Islamic bank Mit-Ghamr in Egypt in 1963 to the development of the first Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) in 1990 in Algiers to the issuance of first tradable Sukuk in Malaysia in 2002.

In Pakistan, BankIslami Pakistan Limited was the first bank to receive a licence to establish an Islamic commercial bank in 2005. Now, assets of Islamic banking institutions have crossed the Rs4 trillion mark as per the Islamic banking bulletin released in December 2020 by the State Bank of Pakistan.

The share of Islamic banks in the overall banking system has also increased to 17% on the assets side and 18.7% on the deposits side.

Despite the stellar performance by Islamic banking globally and locally, the general approach has always been not to revolutionise but to adopt existing practices of the conventional banking system and provide a similar experience to attract customers of conventional banking with the promise of services based on Shariah-compliant principles.

However, if we look at the balance sheet of Islamic banks, a majority of the assets have been built on lending to the government of Pakistan for deficit financing like the way peer conventional banks have been operating for years.

This comfort lending and risk avoidance practices by the banking system – both conventional and Islamic – has made them highly inaccessible for a very crucial sector of the economy – small and medium enterprises (SMEs).

Additionally, for Islamic banks, the chronic excess liquidity issue is a major bottleneck and thanks to the recent issuance of Rs500 billion worth of Sukuk for budget deficit financing and Energy Sukuk of Rs200 billion for reducing the circular debt by the government of Pakistan, which have provided some breathing space.

The other main avenue for raising finance by businesses, which are close to the Islamic principle of profit and loss sharing, ie the stock market, remains largely underutilised.

Surprisingly, 187 of the non-financial companies included in Shariah-compliant equity indices have opted for interest-bearing debt rather than raising capital through the stock market where they are listed.

The inclusion of such interest-bearing companies in the PSX-KMI All Share Islamic Index mainly depends on the relaxation in the Shariah-screening criteria, which allows companies to carry interest-bearing debt up to 37% of their assets.

A majority of the companies listed in the stock market and with good reputation can easily raise extra capital through the issuance of right shares but they still choose to leverage their balance sheets with debt just to avoid diluting their equity position.

Other relatively uncommon Shariah-compliant avenues for meeting financial needs are publicly listed modaraba schemes, which have not shown any promise so far and their performance have remained lacklustre.

The performance of some privately run modaraba schemes has even been marred by scandals in the past. A few of them are being investigated by the National Accountability Bureau for swindling billions in the name of Islamic financing schemes.

With a growing investor base and increasing awareness through social media platforms and other information sources, the demand to establish a true Islamic financial system is gaining traction globally with more and more investors and businesses flocking to explore the available avenues to fulfil their banking and financial needs within the ambit of Islamic jurisprudence.

It’s just a matter of time before they will question the sanctity of each and every claim made by the existing banking and financial institutions and will demand the demonstration of a true spirit for the Islamic banking and financial system to deliver results that are in line with their religious aspirations.

The writer is a financial market enthusiast and is attached to Pakistan’s stocks, commodities and emerging technology
 
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Rumi-Admirer

Chief Minister (5k+ posts)

Citizen X

(50k+ posts) بابائے فورم
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What is going on in this country is this true what is mentioned in this article link below?

Can someone confirm?? If yes than what is the status of all our accounts in Islamic banks and investment in Islamic mutual funds etc. Is state bank aware of all this??

https://tribune.com.pk/story/2316748/islamic-banking-delivering-on-the-promise





Someone please confirm????
First of all there is nothing haram about banking excluding credit cards, the term "islamic banking" was coined just to dupe people with fragile religious sensibilities.
 

mughals

Chief Minister (5k+ posts)
All Banks in a low interest rate environment are just ponzi schemes. They use your deposits to pay their fat lazy bankers. Keep your money at home in a safe and a MP5 nearby.
 

mughals

Chief Minister (5k+ posts)
maxresdefault.jpg

What is going on in this country is this true what is mentioned in this article link below?

Can someone confirm?? If yes than what is the status of all our accounts in Islamic banks and investment in Islamic mutual funds etc. Is state bank aware of all this??

https://tribune.com.pk/story/2316748/islamic-banking-delivering-on-the-promise





Someone please confirm????
One of my friend who is a branch manager in karachi told me this:
Our electricity bill is more than the salaries of the branch employees and together they are more than the deposits of the current account holders of the branch.
 

expat_loyal

Councller (250+ posts)
All Banks in a low interest rate environment are just ponzi schemes. They use your deposits to pay their fat lazy bankers. Keep your money at home in a safe and a MP5 nearby.
I agree if this is the case they are just surviving lending money to government and hope they will not get caught ever.
 

hammy_lucky

MPA (400+ posts)
The real issue is the Fractional Reserve System. In banking wealth is created through debt. We are destroying our future generations and inflation is widening the gap between rich and the poor.
 

Mughal1

Chief Minister (5k+ posts)
nizaame sarmayadaari haraam hai jaisa keh nizamen malukiyat aur mullaiyat. For better understanding of deen of islam from the quran see HERE, HERE, HERE and HERE. baitul maal banking hi hoti hai magar khudaa ke bataaye ke mutaabiq. ajeeb baat hai logoon ko na ehtraaz nizaamen sarmayadaari per hai na hi malukiyati nizaam per au na mullaiayat per. jab mulk main deene islam ke nizaam ka saheeh tarah se kisi ko pata hi nahin hai to juzwi masaail se log kia hal nikaaalna chahte hen?
 

bl0u81

Senator (1k+ posts)
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What is going on in this country is this true what is mentioned in this article link below?

Can someone confirm?? If yes than what is the status of all our accounts in Islamic banks and investment in Islamic mutual funds etc. Is state bank aware of all this??

https://tribune.com.pk/story/2316748/islamic-banking-delivering-on-the-promise





Someone please confirm????
When it comes to Islamic Banking there are lots of open questions which remain unanswered. The conventional Islamic banking is very simple and doesn’t consider complex products for example Total return swaps, Asset swaps, credit default swaps or performance swaps to name few.
In my personal opinion, to reach a conclusion that something is Islamic product and non-Islamic product there is no credible institution or no credible individual. You can only make that judgement if you are thorough in the Islamic teachings and thoroughly understand the mechanics of corporate finance.
 

Sohail Shuja

Chief Minister (5k+ posts)
The thing is, unless you get out of this paper based currency system, it is very difficult to separate Riba from the time value of money and there is this grey area, where halal becomes haram and/or vice versa.

It was rumored that Col Gaddafi was working towards a currency which was fixed with the price of gold or oil, and it was one of the reasons why he was taken out.

 

Scorpionpak

Councller (250+ posts)
JUST STICK TO CURRENT ACCOUNTS, BECAUSE BANKS DON'T GIVE A DIME TO CURRENT ACCOUNT HOLDERS, INSTEAD YOU HAVE TO PAY TO USE BANKING SERVICES LIKE CASH WITHDRAWLS, TRANSFERS, PAY ORDERS ETC ETC. DON'T EARN ANY MARKUP/ INTEREST FROM YOUR MONEY YOU PUT IN THE BANK, IT'S HALLAL ENOUGH.
 

BroInIslam

Voter (50+ posts)
First of all there is nothing haram about banking excluding credit cards, the term "islamic banking" was coined just to dupe people with fragile religious sensibilities.
You need to learn a lot about Islam Banking ... sorry to say your comment is misguiding and not correct.
 

Saboo

Prime Minister (20k+ posts)
I think in a true islamic country you don;t really need a bank. God says spend out of what you have and the rest give it in God;s way…to the poor and needy….So why do you need a bank?
 

Rumi-Admirer

Chief Minister (5k+ posts)
I think in a true islamic country you don;t really need a bank. God says spend out of what you have and the rest give it in God;s way…to the poor and needy….So why do you need a bank?
Please tell me where in Quran Allah said "God says spend out of what you have and the rest give it in God;s way " and prohibited us from saving? give us the Quran reference.
 

Mughal1

Chief Minister (5k+ posts)
Please tell me where in Quran Allah said "God says spend out of what you have and the rest give it in God;s way " and prohibited us from saving? give us the Quran reference.
Please tell me where in Quran Allah said "God says spend out of what you have and the rest give it in God;s way " and prohibited us from saving? give us the Quran reference.

azeezam knowledge sb, islam deen hai mazhab nahin hai aur ye aik tehreek yani mission hai aik khaas maqasad ke liye.

ab tehreek ka context kia hota hai aap ko maloom hi ho ga. agar nahin to soorah kausar padh lijiye. soorah kausar main kia hai? yahee keh khudaa ki wahee her khair ka mumba hai jo khudaa ne insaanu ko di hai. isse badh ker khudaa ne insaanu ko kuchh nahin diya.

is tehreeke khudaawandi ke liye insaanu ko qurbaani deni ho gi aur jo koi is mission ke khilaaf hai woh nakaam hi ho ga jo merzi hai ker le. aaj bhi ham dekh rahe hen sab insaan nakaam hi hen keh unhune is kitaab ko na theek tarah se samjhaa na is ke maqsad ko poora kerne ke liye koi amal hi kiya.

hoze kausar kia hai? woh aik khaire kaseer ka reservoir hai yaani khudaa ki wahee jis main her khair chhuppi hai insaanu ke liye. issi liye ye hoze kausar insaanu ko issi duniya main jannati zindagi de sakta hai. magar insaanu ko is ke liye din raat mehnat kerni ho gi. yaad rakhen jo kuchh bhi insaan haasil kerte hen un ki apni mehnat ka hi phal hota hai. ab mission ko agar kaamyaab kerna hai to sar dhard ki baazi to lagaani ho gi. ab is ke baad baaqi reh kia gayaa hai?

quraan ke mutaabiq insaanu ka jeena marna khudaa ke mission ko kaamyaab kerne ke liye hi hone chahiye. issi main khudaa aur insaaniyat ki badhayee aur shabaashi hai. See verse 2/219 as well. khudaa ne insaanu se jannati zindagi dene ke badle un ki zindagi maang li hai. yani woh agar jannati zindagi chahte hen to unko us ke liye kadi mehnat kerni ho gi. 6/162, 9/111. ab apni zindagi se badh ker insaanu ke paas aur hai kia jo woh khudaa ke liye kharch ker saken?

regards and all the best.
 
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