Islamic finance is a system that follows Islamic Law (Shariah) principles and Islamic-based economics. Money lending (interest-based) as well as investing in businesses are among the prohibited elements.
With each passing year, Islamic finance continues to grow in popularity. Its products are turning into the choice of not only Muslims but also non-Muslims. This is especially true here in Malaysia, considering that the country is a pioneer in the industry.
According to a 2017 report by Bank Negara, Islamic financing in this country now accounts for 34.9 per cent of total loans and financing. Compare that, if you will, to the 5.3 per cent market share it enjoyed in 2000.
Other reasons for its rise in popularity include:
- Fairness and protection from high risks
- Safe from crisis
- Fixed and clear fees
- Lower penalties
If you want to learn about the basics of Islamic finance, this blog is a good place to start. Here, we provide a lot of articles covering a wide range of themes revolving around Islamic finance. However, if you want to delve in deeper and increase your knowledge on the subject, we will suggest a few books that can be helpful.
These are seven books on Islamic finance that you can read:
- Introduction to Islamic Banking and Finance by Brian B. Kettell
This book is a succinct guide to the key characteristics of Islamic banking and highlights how they differ from conventional banking. It also illustrates how Islamic banking is consistent with the Sharia, a key element of which is the prohibition on collecting and paying interest.
- Islamic Law and Finance by Samuel L. Hayes; Frank E. Vogel
Islamic banking practices have either become the law of the land or coexist and compete with Western practices in at least six countries. A growing number of institutions and mutual funds have established Islamic investment and other practices to cater to this burgeoning market.
- Shari’ah Governance in Islamic Banks by Zulkifli Hasan
An in-depth and insightful study of Shari’ah governance from a theoretical and practical perspective. This book also reviews many pluralistic approaches and identifies best practice. With examples, case studies, and practical discussions based in Malaysia, Bahrain, UAE, Qatar, Kuwait, Saudi Arabia, and the UK.
- Islamic Insurance Products: Exploring Takaful Principles, Instruments and Structures by Mohd Ma’Sum Billah
There is much written regarding the Islamic insurance system, but rarely do researchers present the various Islamic insurance products and their structures in one collective place. This book is a timely addition in meeting contemporary market demands by providing a much-needed overview of the Islamic insurance products and their Shari’ah compliant structures.
- The Growth of Islamic Finance and Banking: Innovation, Governance and Risk Mitigation by Hussain Mohi-ud-Din Qadri and M. Ishaq Bhatti
This book covers the recent literature concerning Islamic banking and finance (IBF), focuses on the history of IBF since its inception and introduces the latest innovative concepts and practices in the field. The authors cover important topics such as the role of ownership, Shari`ah compliance and governance structures in raising debt capital using IBF practices, including Fatwa issues and the use of benchmarking practices.
- The Future of Economics: An Islamic Perspective by M. Umer Chapra
This book is a powerful yet balanced critique of mainstream economics that makes a forceful plea for taking economics out of its secular and occident-centred cocoon. It presents an innovative and formidable case to re-link economics with moral and egalitarian concerns so as to harness the discipline in the service of humanity.
- Islamic Finance in a Nutshell: A Guide for Non-Specialists by Brian B. Kettell
Islamic Finance in a Nutshell is a quick and easy guide to understanding the fundamentals of Islamic Finance and how the Islamic Financial markets work. Designed as a quick read for practitioners needing to pick up the basics of the industry, it will enable readers to understand the differences between Islamic and Western finance.