Scribd Logo
Upload

Welcome to Scribd!

  • 46 views

    Topic 3 - Islamic Banking Now

    Uploaded by

    Andinii Pirli
    This document discusses principles of Islamic banking. It explains that Islam prohibits usury and interest (riba) on loans. While Muslims need banking services, traditional banks avoid Islamic principles. However, Islamic banking has emerged as a growing sector with over 100 banks in 40 countries operating based on Islamic finance principles from the Quran. Some key principles are the prohibition of riba, and Islamic banking occurs through profit-sharing agreements, safekeeping arrangements, joint ventures, cost-plus arrangements, and leasing.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Topic 3 - Islamic Banking Now

    Uploaded by

    Andinii Pirli
    46 views2 pages
    This document discusses principles of Islamic banking. It explains that Islam prohibits usury and interest (riba) on loans. While Muslims need banking services, traditional banks avoid Islamic principles. However, Islamic banking has emerged as a growing sector with over 100 banks in 40 countries operating based on Islamic finance principles from the Quran. Some key principles are the prohibition of riba, and Islamic banking occurs through profit-sharing agreements, safekeeping arrangements, joint ventures, cost-plus arrangements, and leasing.

    Original Description:

    Mungkin ini bisa mjd ilmu yg bisa bermanfaat

    Original Title

    Topic 3 - Islamic Banking Now (2)

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    This document discusses principles of Islamic banking. It explains that Islam prohibits usury and interest (riba) on loans. While Muslims need banking services, traditional banks avoid Islamic principles. However, Islamic banking has emerged as a growing sector with over 100 banks in 40 countries operating based on Islamic finance principles from the Quran. Some key principles are the prohibition of riba, and Islamic banking occurs through profit-sharing agreements, safekeeping arrangements, joint ventures, cost-plus arrangements, and leasing.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    46 views2 pages

    Topic 3 - Islamic Banking Now

    Uploaded by

    Andinii Pirli
    This document discusses principles of Islamic banking. It explains that Islam prohibits usury and interest (riba) on loans. While Muslims need banking services, traditional banks avoid Islamic principles. However, Islamic banking has emerged as a growing sector with over 100 banks in 40 countries operating based on Islamic finance principles from the Quran. Some key principles are the prohibition of riba, and Islamic banking occurs through profit-sharing agreements, safekeeping arrangements, joint ventures, cost-plus arrangements, and leasing.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    TOPIC 3

    ENGLISH SUBJECT
    FACULTY OF SHARIA IAIN KEDIRI

    A. Reading Comprehension
    Principles of Islamic Banking
    For millions of Muslims, banks are institutions to be avoided. Islam is a religion which
    keeps believers from the teller’s window. Their Islamic beliefs prevent them from dealings
    that involve usury or interest (riba). Yet Muslims need banking services for many purposes:
    to finance new business ventures, to buy a house, to buy a car, to facilitate capital investment,
    to undertake trading activities, and to offer a safe place for saving. It is because Muslims are
    not opposed to legitimate profit as Islam encourages people to use money in Islamically
    legitimate ventures.
    However, in this fast-moving world, more than 1400 years after the Prophet saw. Can
    Muslims find room for the principles of their religion? The answer comes with the fact that a
    global network of Islamic bank has started to take shape based on the principles of Islamic
    finance. Islamic banking is based on the Qur’anic prohibition of charging interest. It has
    moved from theoretical concept to embrace more than 100 banks operating in 40 countries
    with multi-billion-dollar deposits world-wide. It is also widely regarded as the fastest growing
    sector in the middle Eastern financial service market.
    The best-known feature of Islamic banking is the prohibition on the interest. The
    Qur’an forbids the charging of Riba on money lent. It is important to understand certain
    principles of Islam that underpin Islamic finance. The sharia disallows Riba and there is now
    general consensus among Muslim economists that riba is not restricted to usury but
    encompasses interest as well. The Qur’an is clear about the prohibition of riba, which is
    sometimes defined as excessive interest. Muslim scholars have accepted the word riba to
    mean any fixed or guaranteed interest payment on cash advances or on deposits. Several
    Qur’anic passages expressly admonish the faithful to shun interest.
    Islamic finance takes the form of Islamic banking and Islamic insurance, also known
    as Takaful. Islamic banking is done in five ways:
    1. Mudarabah, a profit-sharing agreement
    2. Wadiah, a safe keeping arrangement
    3. Musharakah, or a joint venture for a specific business
    4. Murabahah, cost plus arrangement where goods are sold with a pre-determined margin
    of profit
    5. Ijirah, a leasing arrangement
    6. Takaful is a form of mutual insurance based on partnership and collective sharing of risk
    by a group of individuals.

    B. Comprehension Exercise
    Complete the following statements by using information in the passage!
    1. For millions of Muslims, banks are institutions to be avoided because ________
    2. Muslim’s purposes in using bank services are _________
    3. In Islam, Muslims are ___________ to take profit.
    4. The principles of Islamic finance are laid down in ____________
    5. The basic principle of Islamic banking laid down in the Qur’an is __________
    6. According to Muslim scholars, riba is _________
    7. According to Muslim economist, parts of bank services that can be considered as riba are
    _______________
    8. The recent growth of Islamic banking is ___________
    C. Vocabulary exercise
    Fill in the blank in each sentence with the listed words below:

    dealings usury profit


    interest charging funds
    underpin deeds deposit
    losses cash loan

    1. Banks provide ______ to who needs any fresh money for the business.
    2. She made two_______ of 5millions last month.
    3. A shariah bank offers an ______ free loan
    4. The good progress in Islamic banking ________these developments
    5. The capitalist system is based on the ________motive.
    6. The government is short of ______so it won’t pay the civil servants next month
    7. I suffer ____________ in the business market
    8. __________are better than words when people need help.
    9. Islamic banking is proud of its reputation for fair ______
    10. The state prohibits the _______of school fee to the elementary school students
    11. I have no _______ on me. May I pay by cheque!
    12. Islam prohibits_______ because it is riba.

    You might also like