Islamic Finance

  Takaful- Provides Protection to our loved ones and our valuable possession in a halal way.   When our business volume begins to grow, we start thinking about the unforeseen events that can damage the company’s assets and bring a bad reputation in the market. We are familiar with this fact that there are plenty of options in insurance companies that provide a variety of services. Again, the question that makes you think, are these commercial financial institutions provide interest-free services and can they avoid uncertainty and speculation?     Islamic finance got answers to all this and provides a solution in the form of Takaful. If you are not familiar with this term then in this blog, we will highlight different aspects that will explain briefly the Islamic way of insurance. So, let’s discuss it in detail. What is the Islamic Insurance, commonly known as ‘Takaful’? Takaful means to give guarantee and share burden of each other when needed.  ...

  Maysir: where easy money comes with negative effects Everyone loves quick money, isn’t it? Therefore, in the West, casino and lottery businesses are quite profitable because everyone wants to try their luck and spend life in luxurious. But, it’s human nature that we want to have more and more and becomes greedy and selfish.   It is the opposite when we talk about Islamic finance. Islamic laws are not formulated by humans that cannot be altered anytime for convinces. These principles are according to the Sharia guidelines to set equal standards and promote ethical values and norms.      We have discussed the prohibition of Interest and permissibility of light Gharar in Islamic contracts. Another element which is forbidden, it is called Maysir: gambling.   In this blog, we will discuss how maysir is practiced in stock, insurance and future contract and reasons why Islam doesn’t support it? What are Qimar and Maysir? When we try to find the s...

  What is Gharar? Does Islam allow light gharar?   We all know how much Islam emphasis on social development that means not one person or a group should take all the benefit. Same as the case in Islamic finance that encourages transparency and foster ethical values. To achieve this, Islamic banks have to make sure every single contract is lined up as per Sharia laws and principles. To put it straight, Usury is strictly forbidden even Muhammad (PBUH) had declared war against the person who is involved in Riba based matters. Gharar is another element that should be avoided. Unlike interest, some scholars are agreeing on this point that Gharar is allowed to some extent unless it should not lead to fraud or total deceit to any of the parties involved in an agreement.  This blog is all about gharar, we will focus on the meaning, types and explain it in detail through numerous examples. So, let get down to the details: What is Gharar Islamic way of trading holds f...