Presentation on Islamic Banking

Presented by :

Padmakar Tapal (B-28)

Rupesh Nagwekar (C-30)

Nitin Pathade (C-31)

Amey Parab (A-21)

Islamic banking refers to a system of banking or banking activity that is consistent with the principles of Islamic law (Sharia) . Sharia prohibits, (Riba, usury) . i.e, interest free business.

Objective Of Islamic Banking: Banking Without Riba

The main objective of an Islamic Bank is to prohibit
Muslims from dealing with interest or usury (Riba) which

has been strictly prohibited by Allah, and to protect them

from one of the biggest sins
Dubai Islamic Bank Statement

Basic Framework: Concept of Money

Money as a form of wealth

Money: primary function: medium of exchange No price should be charged for money Basic rule in lending: return an equal amount

Difference between Islamic and Conventional Modes of Finance

money Bank money + money (interest) Client

Conventional

Difference between Islamic and Conventional Modes of Finance

.

Bank

Goods & Services money

Client

Islamic

Major Terms Used in Islamic Banking

Shariah Islamic law Riba Interest Hiba profit Ta'widh Compensation Ujrah Payment in exchange for services, benefits and privileges offered to the customers

TYPES OF ACCOUNTS
Current Account

Deposits available

Savings Account

Investment Account

ISLAMIC BANKS MODES OF FINANCING

Investment Financing

Trade Financing

Lending

Other Financial Services

Basic Framework: Prohibition of Riba

Riba as interest (differences among Muslims)

Interest in all forms prohibited

All interest-based transactions should be avoided Interest-based transactions are seen as unjust: risk on the borrower

REASON AND NEED OF ISLAMIC BANKING IN INDIA

Islamic banks can give inclusive growth along with control over inflation. Equity finance is extended by lower cost of credit. It provides equitable share of profit. It provides small amount of loans

Banks with Islamic Portfolios

England

HSBC, Lloyds TSB

CIMB Royal Bank of Canada

Malaysia, Cambodia, Singapore

Canada

CONCLUSION

Islamic banking being a young concept can help development of poor economy. Though having few draw backs it has its own advantages to stand on.