Islamic Banking in Nigeria: Issues and Prospects

2016 ◽  
Vol 4 (2) ◽  
pp. 34 ◽  
Author(s):  
Nuruddeen Abba Abdullahi
Keyword(s):  
Public Awareness ◽  
Banking System ◽  
Islamic Banking ◽  
Secondary Sources ◽  
Banking And Finance ◽  
Adequate Knowledge ◽  
Islamic Religion ◽  
Developmental Opportunities ◽  
The Subject ◽  
Nigerian Banking

The Nigerian banking reform precipitated the adoption of Islamic banking and finance in 2009 as additional door to banking mechanism in the country. However, the implementation of the Islamic banking or non-interest banking has generated a lot of debate, specifically because its foundations are based on Islamic religion. This paper briefly reviews the concept, the challenges and prospects of Islamic banking in Nigeria. The paper relies on the secondary sources by reviewing and analysing various works on the subject. A reflection on the size of its population and the developmental opportunities indicates that Nigeria has the prospect of becoming the hub centre of Islamic finance in Africa. Yet there are numerous challenges to the development of the Islamic banking system in the country, including misrepresentation of the system, lack of linkages and investment institutions, lack of adequate knowledge, as well as shroud business ethos and corruption, which is endemic in the country. The paper recommends the need for greater public awareness about Islamic banking and creation of enabling environment (i.e. the legal, accounting and taxation systems) for the working of Islamic financial system.   

Challenges Faced in Full Establishment of Islamic Banking System in Nigeria

2017 ◽  
Vol 1 (1) ◽  
pp. 1-6 ◽  
Author(s):  
Zainab Idris
Keyword(s):  
Banking Sector ◽  
Banking System ◽  
Islamic Banking ◽  
Investment Opportunity ◽  
Huge Number ◽  
Foreign Investors ◽  
Banking And Finance ◽  
Conventional Banks ◽  
Infant Stage ◽  
Made In

Islamic banking in Nigeria is still at its infant stage and surrounded by a lot of challenges and set bank. It is important to note that despite the huge number of Muslims population in the country, little progress has been made in ensuring its full take off and operationalization. The paper there examines the challenges Islamic banking is faced with in Nigeria. Through review of past studies, the paper the paper identify factors like; Problem of Competition with dominant conventional banks, Problem of Competition with dominant conventional banks, Double taxation and others as the major challenges of Islamic banking in Nigeria. However the paper, the paper recommends that Islamic banking and finance in Nigeria offers a huge investment opportunity for both domestic and foreign investors what is most needed to achieve this, is for all stakeholders to collaborate in a way that a structured, functional and sustainable Islamic banking model will be formulated and communicated widely so as to gain general acceptability. Furthermore, the paper will serve as a guide to investors by pointing the problems the Islamic banking sector is facing in Nigeria.

scholarly journals Financial Inclusion through Islamic Banking

2017 ◽  
Vol 6 (2) ◽  
pp. 324
Author(s):  
Mumna Nazar
Keyword(s):  
Financial Services ◽  
Banking System ◽  
Secondary Data ◽  
Financial Inclusion ◽  
Primary Data ◽  
Islamic Banking ◽  
Committee Report ◽  
Secondary Sources ◽  
The People ◽  
Financial Exclusion

<div><p><em>Financial inclusion is a buzz word today. It plays an important role in driving away the poverty from the country. Financial inclusion is the process of ensuring financial services to the weaker sections of the society at an affordable cost. As per the Sachar Committee Report, Muslims in India are financially excluded. Even though they have an account, the extent of usage is very low due to the religious reasons.  The Non-Muslims also do not actively engage in the formal financial system due to the interest involvement. Islamic Bank can serve as a remedy for the financial exclusion of the Muslims as well as Non-Muslims community. The objective of this paper is to understand the extent of financial inclusion among the people in Kerala and their awareness and preference towards Islamic banking. Both primary and secondary data are collected for the study. Secondary data are collected from various secondary sources like published articles, journals, reports, books and websites. Primary data are collected with the help of questionnaire among people in Kerala. The study revealed that most of the respondents have accessed bank accounts but the extent of usage is only for namesake. Moreover the awareness and preference towards Islamic Banking is very high among the Muslims as well as Non-Muslims and suggested that proper care must be taken for introducing Islamic banking system in India. It will ultimately leads to the inclusive growth of our country.</em></p></div>

Contemporary Islamic economic studies on Maqasid Shari’ah: a systematic literature review

Humanomics ◽  
2017 ◽  
Vol 33 (3) ◽  
pp. 315-334 ◽  
Author(s):  
Akilu Aliyu Shinkafi ◽  
Nor Aini Ali
Keyword(s):  
Economic Development ◽  
Literature Review ◽  
Human Resource Development ◽  
Management Policy ◽  
Islamic Banking ◽  
Security Risk ◽  
Content Type ◽  
Banking And Finance ◽  
The Subject ◽  
New Research

Purpose The purpose of this paper is to come-up with a systematic exertion on Maqasid Shari’ah in Islamic economics, banking and finance, with a clear focus on forming an appropriate and novel framework that identifies the effort of contemporary scholars and detects the existing gap that might possibly champion new research commitments. Design/methodology/approach A systematic approach to literature review was steered through the means propagated by the Centre for Reviews and Disseminations (DSR), but modified to the precise requirements of this review. Google Scholar was searched throughout the passage. The search criteria are confined to English documents that are within the period of 2006-2016. Articles that did not score or did not convince that the subject of Maqasid Shari’ah has been applied in Islamic economy, Islamic banking, Islamic finance, Islamic financing products and economic development are excluded. Appropriate search keys are used to gather better results. Findings The findings inform that contemporary scholars show a robust commitment to the themes of the result during the stated period. The outcome reveals that contemporary scholars designate more interest and attention on Islamic banking and expose their potential specialty in the expanse than other themes. The study further highlighted the gap of some significant areas that are either outside the coverage of the reviewed documents or require more attention from contemporary scholars, for instance, wealth formation and management, wealth consumption, socioeconomic security, risk management, corporate governance, management policy, human resource development, prohibition of Riba, profit and loss sharing (PLS), etc. Research limitations/implications The paper is limited to contemporary aspects of Islamic economics, banking, finance and economic development that have a link with the subject of Maqasid Shari’ah. Practical implications A review of these scholarly reported documents has the potential to draw attention toward filling the existing gap that will likely result in salvation of current issues on the subject of Maqasid Shari’ah that has a direct association with Islamic economy, banking and finance. Originality/value The paper is original in its nature considering the fact that it is assumed as the maiden attempt of its kind in the field. It is a treasure to all those who may cherish and find it relevant in their progressive and rounded convention or application on the matter.

scholarly journals Islamic Banking and its Legal Validity in India

2016 ◽  
Vol 4 (2) ◽  
pp. 1-18
Author(s):  
Dikshit Arushi
Keyword(s):  
United Kingdom ◽  
Public Awareness ◽  
Banking System ◽  
Islamic Banking ◽  
New Delhi ◽  
Free Banking ◽  
Legal Regime ◽  
The Public ◽  
System A ◽  
The World

Islamic banking is an emerging model of banking which is currently practiced in several countries such as Malaysia, Indonesia, Afghanistan, Bangladesh and United Kingdom. The most intriguing aspect of Islamic banking is that it works on a purely no interest basis. Given the fact that India is a country with one of the largest Muslim populations in the world, the researchers believe it is important to understand the public awareness, acceptability and feasibility of introducing this system of banking in India. This paper primarily aims at discussing the legal viability of introducing Islamic banking in India, taking into account the current legal regime. In analyzing how forthcoming the population will be towards this banking system, a sample of the population was chosen from Pune and New Delhi and surveyed with the help of a questionnaire, leading to the inference that most people are open to the concept of interest free banking but are unwilling to accept the Islamic ideology it is derived from.

scholarly journals Islamsko bankarstvo i modeli financiranja u poslovanju islamske banke

2017 ◽  
Vol 6 (2) ◽  
pp. 65
Author(s):  
Nemanja Budimir
Keyword(s):  
United Arab Emirates ◽  
Islamic Law ◽  
Banking System ◽  
The Philippines ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Banking And Finance ◽  
Minority Religion ◽  
Conference Organization ◽  
The Uk

Islamic banking is now a widespread notion in both Islamic countries and the West. It denotes a bank form and finances that seek to provide services to clients without interest. Proponents of Islamic banking say that the main objective is the "fish", which is prohibited by Islamic law. This attitude toward interest contributed to the unification of several Islamic schools, with the aim of finding ways for the development of an alternative banking system that would be compatible with the rules of Islamic Laws, and in particular to the rules relating to the prohibition of interest. Since the mid-1970s, the number of Islamic banks is on the rise. Islamic banks are not only based in countries where Islam is the prevalent religion, such as Egypt, Jordan, Sudan, Bahrain, Kuwait, United Arab Emirates, Tunisia, Mauritania and Malaysia, but also in countries such as the UK, Germany and the Philippines where Islam is a minority religion. The International Islamic Bank, the Islamic Development Bank, whose shareholders are members of the Islamic Conference Organization are acting as sponsors for Islamic banking and finance throughout the Islamic world.

scholarly journals A Study on Awareness and Attitude Towards Islamic Banking in Tirupattur District

2021 ◽  
Vol 9 (4) ◽  
pp. 1-6
Author(s):  
K. A Maria John Joseph ◽  
D Mahalakshmi
Keyword(s):  
Islamic Law ◽  
Banking System ◽  
Secondary Data ◽  
Sampling Technique ◽  
Islamic Banking ◽  
Secondary Sources ◽  
Law Of Nature ◽  
Finance Model ◽  
The Holy Quran ◽  
Convenience Sampling

The banking system in every country is based on the interest system. Interest-bearing money is almost like the law of nature where money generates money but alternative banking system called Islamic banking. Islamic banking follows Islamic ethical principle which appears very different from those of the conventional western banking finance model. In this study, the data has been obtained through both primary and secondary sources. The secondary data were collected from journals, magazines, and the Holy Quran. The fresh data were collected through questionnaires from Tirupattur District. The research design used for this study is descriptive type. The Sampling design used for the study was the convenience sampling technique. The percentage analysis was used for the study. The Islamic banking system in India was introduced for both Muslim and Non-Muslim customers. Few of the Muslim customers have an account in Islamic banking. Most of the customers do not have awareness about the Islamic bank. This study aims to discover awareness and attitude about Islamic banks, both Muslims and non-Muslim in Tirupattur District. The main objective of Islamic Banking is to retain their existing customers and attract new customers by creating awareness about their banking system. This banking system follows the interest-free principles under Islamic Law.

Tawarruq application in Islamic banking: a review of the literature

2014 ◽  
Vol 7 (4) ◽  
pp. 485-501 ◽  
Author(s):  
Nasrun Mohamad ◽  
Asmak Ab Rahman
Keyword(s):  
Content Analysis ◽  
Literature Review ◽  
Design Methodology ◽  
Banking System ◽  
Future Research ◽  
Islamic Banking ◽  
Review Of The Literature ◽  
Content Type ◽  
Comprehensive Literature Review ◽  
The Subject

Purpose – This paper aims to present the results of a comprehensive literature review with regard to the application of Tawarruq in the Islamic banking system covering the period between 2011 and before. The review aims to synthesize the previous research, capsulize the structural overview inasmuch as future research might be oriented and identify the gaps and direction for future research. Design/methodology/approach – A range of published and unpublished documents was collated and filtered based on the defined rules to identify the determinants of the writing. The documents were then be classified into few segments in which content analysis was conducted to capsulize the essence of the subject matter described in the literature. Findings – The analysis demonstrates that most of the studies discussed the fundamental theories which concerning the area of jurisprudence, while a few of them did discuss the application aspect in the banking environment. However, none of the operational process is discussed in-depth, whereas the risk of Shari’ah non-compliance might arise in the detail transaction. Research limitations/implications – The databases used in the search might not contain all the documents that could be relevant for the review. Furthermore, the defined-rule for document searching and selection excluded the out-of-scope documents that might be relevant. Originality/value – This paper identifies the gaps that become apparent in the literature in assisting researchers to ascertain the interesting areas as well as the direction for future research.

Exploring the ethical aspects of Islamic banking

2015 ◽  
Vol 8 (1) ◽  
pp. 85-98 ◽  
Author(s):  
Hasan Gilani
Keyword(s):  
Literature Review ◽  
Banking Sector ◽  
Financial Institution ◽  
Banking System ◽  
Recent Decade ◽  
Subject Area ◽  
Islamic Banking ◽  
Ethical Management ◽  
Content Type ◽  
The Subject

Purpose – The purpose of this paper is to look into the ethical practices of a profit-driven financial institution that is currently adopting Islamic banking and whether it can actually be ethical from an Islamic perspective. The recent decade has seen an upsurge of the increasingly integration of ethical management into operational strategies by businesses across the globe. Like any other religion, Islam wants its followers to be truthful and honest and to be compliant with its teachings and especially in a business transaction. This research paper explores the ethical factors of Islamic banking and how it is perceived by its stakeholders. Design/methodology/approach – Due to the exploratory nature of the research and the fact that it involves in-depth theoretical analysis, a qualitative research method was adopted to explore the details of ethics in Islamic banking sector. The aim of this research was to explore the ethical options of an Islamic bank. This was done by carrying out in-depth interviews with the managers and executives of Islamic banks having authority over the subject of Islamic banking and Shariah finance. Furthermore, a detailed session of interviews was also carried out with the customers of Islamic banking to take their views on the subject issues. The data are analysed through thematic content analysis and matched with the existing theory with the objective of coming up with detailed findings that would contribute to knowledge on the subject of ethical Islamic banking. Findings – The paper provides empirical insights about ethical management as a vital part of Islamic banking modus operandi. The findings highlight the involvement of ethics in different procedures, operations and approaches of Islamic banking and how it is perceived by its many stakeholders. Practical implications – The motivation of this thesis comes from literature review to explore the ethics of Islamic banking and how it Islamic banking is perceived by stakeholders at an ethical banking practice. This research aims to aid bankers in identifying what practices they can enhance and what practices should be dropped to bring about a more ethical banking system. This research was prompted as a result of the gaps identified in the literature review followed by the observations made of the market by the researcher. It was evident that further research on this topic was required to aid the subject. Originality/value – The research is original in its nature, as there have not been many instances where the ethical management theory has been explored within the Islamic banking sector. Given the new literature on corporate branding and customer perception, this research can contribute very positively towards the subject area. This research would pave new research avenues to be explored and enhance academic contribution on the common subjects.

scholarly journals “Muzarah” Share-Cropping and “Musagah” Irrigation as Methods of Partnership for Financing Agricultural Sector and Micro Finance Projects Practiced by Islamic Banks.

2020 ◽  
Vol 6 (2) ◽  
pp. 31-46
Author(s):  
Ahmed El-Murdi Saeed Omar ◽  
Keyword(s):  
Agricultural Sector ◽  
Banking System ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Banking Systems ◽  
Banking And Finance ◽  
Finance Law ◽  
Academic Area ◽  
Business And Management ◽  
Muslim Scholars

In this paper, the researcher expected to explain provisions of Islamic financial jurisprudence in respect to the related and selected commercial contracts and to relate their implantation to Islamic Banking system. The objectives are to tell the reader: (1) how the pioneer Muslim scholars compiled and documented the provisions of Muzarah and Musagah as essential methods for partnership recently in Islamic Banking systems. The researcher adopts the APA style that is well known method for referencing to evaluate literature. Findings from the research showed that (1) Sharing corps is a contract allowed within Hanbali School of thought and in the view of Abu Yousuf and Mohammed bn Al-Hassan Alshybaini. (2) for the validity of share cropping conditions of: The land that should be cultivated, the seeds, the employees, the profit and the duration of the contract should be well stated. (3) Share cropping could be valid or vitiated. (4) The contract of Musagat or irrigation will be formed by offer and acceptance. (5) Contract of irrigation is handling tree to workers for purpose or irrigation or harvesting. (6) Contract of Musagah and Muzarah sharing the same conditions. (7) Both of the contracts bearing the same reasons of void or invalidity. The researcher recommends that relevant academic area of knowledge in particular Department sof: economics, banking and finance, law, Islamic Sciences, Business and Management to include the Islamic methods of investment in business, in their curriculums and syllabus at both undergraduate and postgraduate levels. Keywords: “Muzarah”, Share-Cropping, “Musagah”, Irrigation, Partnership, Financing, Agricultural Sector, Micro Finance, Projects, Islamic Banks.

scholarly journals Malaysia: 30 Years of Islamic Banking Experience (1983-2012)

2012 ◽  
Vol 11 (10) ◽  
pp. 1133 ◽  
Author(s):  
Khiyar Abdalla Khiyar
Keyword(s):  
Capital Accumulation ◽  
Development Process ◽  
Free Market ◽  
Banking System ◽  
Islamic Banking ◽  
The Public ◽  
Banking And Finance ◽  
Chinese Origin ◽  
Market Economic ◽  
The Government

Malaysia proved to be at the forefront of Islamic banking and finance by adopting a dual banking system where the conventional and Islamic banking systems co-exist. The Islamic banking has been in operation since 1983 and offers a variety of Islamic financial instruments. In such a multi-ethnic and multi-religious country, customers get the financial products and services they like. In the early 1980s, the government encouraged all Malaysians to be involved in the fast-track development process with a vision to make Malaysia a fully industrialized country by the year 2020. Actually, the development of Malaysias dual banking system is tied up with its social and economic policy and that is why it was fully supported by the countrys top leadership in addition to the Central Bank, the Parliament, and the public in general. Islamic banks can motivate Muslims to increase savings and reduce hoarding. This kind of motivation was expected to enhance their participation in the development process contributing to savings mobilization and capital accumulation in order to improve their standard of living and bring them up to par with their countrymen of Chinese origin. Among the countries with a free market economic system, Malaysia has emerged as the first country to implement a dual banking and financial system. The Malaysian model has been recognized by many Islamic countries as the model to emulate.

Sign in / Sign up

Export Citation Format

Share Document