Presentation on theme: "Starting in the Name of Allah, The Most Beneficent, The Most Merciful"— Presentation transcript:
1 Starting in the Name of Allah, The Most Beneficent, The Most Merciful بسم الله الرحمن الرحيمStarting in the Name of Allah,The Most Beneficent, The Most Merciful
2 MAZHAR ALI BOKHARI GULF AFRICAN BANK LIMITED Head of International Operations& Strategic Planning DivisionGULF AFRICAN BANK LIMITEDNairobi, KENYAAt AlHuda CIBE Awareness workshopB.Z University - MultanPhone Nos /
3 Honorable Guests, Participants, Ladies & Gentlemen. Thank you for giving me the honor of presenting an overview of Islamic Banking
4 Importance of Trade in Islam Islam has given an immense importance to tradeThe nobility of this profession is obvious from the fact that it was the chosen profession of prophet Muhammad (PBUH).
5 WHY ISLMIC BANKINGBefore explaining the concept “what is Islamic Banking” the elaboration of concept “why Islamic Banking” is very important.Islam is a complete code of life that provides guidance regarding each aspect of life.
6 The primary objectives of Islamic Economic System are as under. WHY ISLAMIC BANKINGThe primary objectives of Islamic Economic System are as under.Equal Distribution of wealthSocial justiceThese objectives can never be achieved in Interest/Riba based economic systems.
7 WHAT IS ISLAMIC BANKING Now we come to our core question“Islamic banking has been defined as banking in consonance with the ethos and value system of Islam and governed, in addition to the conventional good governance and risk management rules, by the principles laid down by Islamic Sharia’h”
8 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking1) Functions and operations are based on Sharia’h principlesConventional Banking1)Functions and operations are based on fully man made principles
9 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking2) Promote risk-sharing between provider of capital (investor) and user of funds (entrepreneurs)Conventional Banking2) Investor is assured of pre-determined rate of interest
10 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking3) Aim at maximising profit but subject to Sharia'h restrictionsConventional Banking3) Aim at maximising profit without any restrictions
11 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking4) Partners, investor and traders, buyer or seller relationshipConventional Banking4) Creditor-Debtor relationship
12 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking5) Encourage asset-based financing and based on commodity tradingConventional Banking5) Based on money trading. Money is a medium of exchange and not a commodity, its sale and purchase is prohibited in Islam.
13 DIFFERENCE BETWEEN ISLAIC AND CONVENTIOANL BANKING Islamic Banking6) No right of profit if there is no risk involved. The profit and loss sharing depositor may lose money in case of loss.Conventional Banking6) It is almost risk free banking and depositor has no risk of losing its money because interest is guaranteed.
14 ISLAMIC BANKING PRODUCTS AND SERVICES Currently available Islamic Banking Products and services arePartnership based modes of financingMusharaka Finance, Mudaraba Finance,Trade based modes of financingMurabaha Finance, Salam financeRental based modes of financingIjarah Finance, Diminishing Musharaka Finance
15 Email: email@example.com THANK YOUMAZHAR ALI BOKHARIPhone Nos /
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