Institutionalising Justice in Islamic Finance

Jan, Shafiullah; Khan, Zahoor; Ullah, Karim

doi:10.12816/0051175

Cited by 13 publications

(15 citation statements)

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“…Tahdhib al-Fard (Educating the individual) refers to the human's development that focuses on not only knowledge and skills but also their spiritual values (Siddiqi et al, 2019). Therefore, it can be viewed in the broader spectrum of falah (success) in this world and hereafter (Jan et al, 2018). According to Chapra (2008) educating the individuals performs a dual function.…”

Section: Analysis Of the Selected Papersmentioning

confidence: 99%

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Nexus between higher ethical objectives (Maqasid Al Shari’ah) and participatory finance

Nouman

Siddiqi

Ullah

et al. 2021

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Purpose This paper aims to conceptualize the nexus between the participatory finance and the higher ethical objectives within the Islamic moral economy, also termed as Maqasid al Shari’ah. Design/methodology/approach Insights from the extant Islamic economics and finance literature are integrated through an interpretative systematic review using the principles from critical interpretative synthesis (CIS). Findings A coherent framework is synthesized comprising the typology of the Maqasid al Shari’ah, the axioms of participatory finance and their nexus which is formulated by theorizing the common thread of meaning through the axioms of participatory finance and Maqasid al Shari’ah at the interpretative level. This framework postulates that the participatory finance fits well in the ethos and the value system of Islam. Moreover, “social well-being” invariably provides the nexus between the Maqasid al Shari’ah and participatory finance. Originality/value This study contributes to the Islamic economics and finance literature by integrating the dissenting views from the divergent literature related to the basic philosophy of Shari’ah and participatory finance and provides grounds for policy implications, particularly, for designing the financial products. Moreover, it demonstrates an application of interpretative systematic review in Islamic banking and finance research.

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Section: Analysis Of the Selected Papersmentioning

confidence: 99%

“…Similarly, Iqamah al-'Adl (Establishing justice) encompasses equal treatment among individuals, and avoidance of discrimination to ensure peace and moral and social uplift of the society (Jan et al, 2018). Qur'an has emphatically commanded people to stand firmly to justice (Qur'an, 16:90 and 4:135).…”

Section: Analysis Of the Selected Papersmentioning

confidence: 99%

Nexus between higher ethical objectives (Maqasid Al Shari’ah) and participatory finance

Nouman

Siddiqi

Ullah

et al. 2021

QRFM

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“…Tahdhib is referred to the development of human beings, which not only focus on skills and knowledge but also spiritual values. Educating individuals can be viewed in the broader spectrum of falah or success for both the worlds (Jan, Ullah & Khan, 2015(Jan et al, 2018). Education is needed for individuals so that one can become good human beings.…”

Section: Educating the Individual (Tahdhib Al-fard)mentioning

confidence: 99%

“…Numerous renowned economists including Ahmed (2000); Chapra (1985); Siddiqui (2001), and Naqvi (2016) opine that IBF can be dealt as a sub component of larger Islamic Economic System. This socio-religiously constructed economic system understanding, according to Jan, Khan, and Ullah (2018) places the wellbeing of society at the center and achieves human development through fair distribution and establishment of social justice and equity as proposed by Maqasid al Shariah or the objectives of Shariah…”

Section: Introductionmentioning

confidence: 99%

Maqasid al Shariah and Stakeholders’ Wellbeing in Islamic Banks: A Proposed Framework

Siddiqui¹,

Jan²,

Ullah³

2019

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The extant literature describes and justifies stakeholders' wellbeing as the essence of Islamic Banking and Finance (IBF). This infers the compulsion on Islamic banks to devise their operations based on inclusive wellbeing, and a greater perspective from the Maqasid al Shariah framework, and not merely converging on the compliance rulings. This paper presents a review and analysis of the present literature on Maqasid al Shariah and Stakeholders' wellbeing and synthesizes a framework for gauging the theoretical association between the classical Maqasid al Shariah and Stakeholders' wellbeing. The proposed framework can be used as a dependable framework for policy implication and future research in IBF. Moreover, concentrations of research efforts are identified from the present review and directions for future research are proposed.

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“…For example, it is usually argued that participatory financing would ensure availability of more financial resources to small businesses, and would therefore gear up employment creation and growth of gross domestic products (Huda, 2012;Nouman & Ullah, 2014). Moreover, it would promote justice and equity in society since it would finance all deserving ventures, not just the ventures with well-established credit history or excellent collateral (Jan, Ullah & Khan, 2018). Thus, a financial system based on risk sharing would lead to greater allocative efficiency, equity, GDP growth, and financial system stability (Iqbal & Molyneux, 2005).…”

Section: Introductionmentioning

confidence: 99%

Variants of Participatory Financing for Risk Assessment and Mitigation in Islamic Banking

Nouman¹,

Ullah²,

Jan³

2019

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The participatory modes of Islamic financing including Musharakah and Mudarabah are widely accepted as the ideal modes of financing among the jurists of Islamic banking and finance. However, paradoxically, these are not the most popular modes of financing in practice. The practice of the participatory financing in Islamic banking is constrained by several factors. Therefore, Islamic banks are applying the adapted variants of Musharakah. The present study aims to explore the prevailing variants of participatory financing in the Islamic banking industry of Pakistan using multiple case studies strategy. Findings suggest that Islamic banks adapt the participatory financing to make these fit for SME financing, corporate financing, consumer financing, and commodity operations financing within the embedded contractual variants of Musharakah namely diminishing Musharakah and running Musharakah, while pure Musharakah and Mudarabah are not applied in practice. The study also provides insights into the design of participatory financing arrangements and the procedures adopted by Islamic banks for assessing and mitigating the underlying risks associated to the participatory financing, particularly the risk induced by asymmetric information including adverse selection, and moral hazards.

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Institutionalising Justice in Islamic Finance

Cited by 13 publications

References 0 publications

Nexus between higher ethical objectives (Maqasid Al Shari’ah) and participatory finance

Nexus between higher ethical objectives (Maqasid Al Shari’ah) and participatory finance

Maqasid al Shariah and Stakeholders’ Wellbeing in Islamic Banks: A Proposed Framework

Variants of Participatory Financing for Risk Assessment and Mitigation in Islamic Banking

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