Our Role in Creating Awareness on Islamic Banking & Finance

By Muhammad Rizwan-ul Haque

Published December 14, 2017

Introduction

Although the Islamic Banking & Finance industry is growing rapidly, the author argues that serious concerns remain regarding compliance with the teachings of the Qur’an and Sunnah. Therefore, awareness should be created with wisdom and sincerity so that justice, harmony, and accountability may prevail within society.

Surah An-Nahl (16:125)

“Call to the way of your Lord with wisdom and good instruction, and argue with them in the best manner. Indeed, your Lord knows best who has strayed from His way, and He knows best those who are guided.”

Fatwas, Interpretations, and Fiqh Opinions

The article argues that many fatwas and interpretations may originally have been written with good intentions. However, over time and through changing circumstances, some opinions may require reassessment. According to the author, many people continue to follow these interpretations either out of habit, lack of awareness, or to protect worldly interests.

A Statement Attributed to Imam Abu Hanifa

Imam Abu Hanifa is reported to have said:

“Do not write down everything you hear from me, for surely I may hold an opinion today and leave it tomorrow, hold another tomorrow and leave it the day after.”

This statement is often referenced to emphasize the importance of continuous reflection and scholarly review.

Benchmarking to Interest Rates

The author argues that the use of conventional interest-rate benchmarks causes Islamic Banking & Finance institutions to closely resemble conventional financial systems in terms of approach, implementation, and outcomes.

A Historical Perspective

According to the article, there is no known precedent showing that prevailing market interest rates during the time of the Prophet Muhammad (SAW) were used to benchmark commercial transactions.

Reference to Muhammad Taqi Usmani

The article references the views of Muhammad Taqi Usmani, a prominent scholar in Islamic finance, noting that even certain Islamic financial tools such as Murabaha have limitations in achieving broader economic objectives.

Imperfections in the Existing System

The author maintains that the present Islamic Banking & Finance framework remains imperfect from a pure Shariah perspective because, in his view, it avoids genuine business risk while continuing to rely on interest-based benchmarks.

Our Responsibility

The article emphasizes that Muslims are encouraged in the Qur’an and Sunnah to discourage practices they believe to be harmful or forbidden and to promote awareness through peaceful dialogue and education.

Difference of Opinion

The author clarifies that his disagreement is directed toward practices within Islamic Banking & Finance that he believes conflict with Qur’anic teachings, particularly the continued reliance on interest-rate benchmarking.

Beyond Interest

The article further argues that, according to the author’s interpretation, concerns extend beyond interest alone and include:

• Loans used primarily for profit generation,

• Excessive leveraging, and

• Banking structures that depend on interest-based systems.

  
  

A Reflection

The article concludes with a quote:

“There are three classes of people: those who see, those who see when they are shown, and those who do not see at all.”

Surah Saba (34:34)

“And We did not send a warner to any city except that its affluent people said, ‘Indeed, we reject what you have been sent with.’”

May Allah (SWT) guide us all toward understanding and implementing the true message of the Qur’an and Sunnah. Aameen.

Author Credit:

This article is written by Muhammad Rizwan-ul Haque, a researcher and commentator on Islamic finance and economic systems.