The Financial Times has put together a series ofabout Sharia-Compliant Finance. They neglected to provide any truly serious questions or answers. For a good rundown of some of the salient questions that the West should be asking about sharia finance, we call your attention to Sharia Finance Watch Blog’s Frequently Asked Questions page:
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Finance briefing: Islamic finance and tenets explained
Published: November 2 2008 21:19 | Last updated: November 2 2008 21:19
Islamic finance has experienced rapid growth. In the seventh of a monthly series, Usman Hayat, CFA, Director of Islamic Finance and Environmental and Social Governance discusses what Islamic finance is and how it is practised.
What is Islamic finance?
Islamic finance is financial practice that complies with shariah, or the divine Islamic law. Shariah consists of ibadah, dealing with worship, and muamlat, dealing with practical matters of day to day life. Commerce, banking, and finance are addressed by muamlat. The roots of modern Islamic financial institutions are often traced to the 1970s when the first Islamic commercial bank and later the Islamic Development Bank were formed. Today, Islamic financial services are being offered by Islamic as well as conventional financial institutions.
What is the size of the Islamic finance industry?
Estimates vary and quickly become outdated, but recent estimates put the size of assets between $750bn (£455bn, €575bn) and $1,000bn. The industry remains very small compared to conventional finance, but Islamic finance has grown approximately 15-20 per cent a year recently. It is also estimated there are over 300 Islamic financial institutions worldwide and over 325 Islamic mutual funds and ETFs.