Islamic banking in practice

19-5-2004 | IslamWeb

Question:

Do Islamic banks really abide by Islam, or is 'Islamic banking' just a scheme to circumvent the Shariah? Is it Halal to work for such banks?

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Answer:

Praise be to Allah, the Lord of the Worlds; and may His blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.

Islamic banks are those which enforce the rulings of Islamic Shariah in all their transactions.  Thus every bank that applies the rulings of Shariah is considered as Islamic bank.  It could be known by the existence of an authentic, reliable and religious jurist committee that supervises all the bank’s transactions.

Any bank that functions under the above committee is Islamic and hence it is permitted to deal with it.  Any bank that lacks the above condition is not Islamic, despite its claim of being an Islamic bank.

Allah knows best.