THE ROLE OF ISLAMIC BANKING SYSTEM.
THE ROLE OF ISLAMIC BANKING SYSTEM.
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Date
1992-11
Authors
ABDU, ALHAJI IBRAHIM (JAGA)
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Abstract
Prohibition of interest in Islam necessitates
that in countries seeking to introduce Islamic
economic system, banking and financial practices be
organised on a basis other than interest. Research
work on t h e subject has proceeded to suggest that
the principle of profit sharing offers the best
alternative to i n t e r e s t in an Islamic system.
S t a b i l i t y in the value of money should be
accorded high p r i o r i t y in the Islamic frame of
reference because of the unequivocal stress of Islam
on honesty and fairness in a l l human dealings and
because of the negative impact of inflation on
socio-economic justice and general welfare. While
i n f l a t i on is incompatible with the goals of an
Islamic economy, prolonged recession and unemployment
are also unacceptable. In Islamic system, monetary
policy in Islam must therefore aim at a high rate
of economic growth with full employment.
The requirement to attain material prosperity
within f ramework of Islamic values necessitates that
it should not be attained through the production of
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inessential and morally questionable goods and
services, should not lead to an exessive and overly
rapid use of God given resources at the expense of
future generations and should not harm present or
future generations by degenerating the moral or
physical environment.
Since Islam abhors Riba (interest), it is
natural that abolition of interest should be the
corner stone of all efforts at recognising th
economic system on the basis of Shari'ah.
Prince Mohammed Al-Faysal Al-Saud visited
Nigeria in 1983 to explore the means and possibility
to establish in the country an interest free Islamic
Bank on the pattern of Sudan, which unfortunately
could not be possible due to our selfish and UnGodly
love of Riba (interest).
However, neighbouring countries in West Africa
like: Gabon, Mali, Senegal, Chad, Niger, Sierraleone,
Guinea, Upper Volta, Tego etc have already established
interest free Islamic Banks very successfully.
Again countries in the world like; Sudan, Saudia,
Egypt, Iran, Iraq, Libya, Algeria, Somali, Pakistan,
Afghanistan, Turkey, India, Morocco, Tunisia,
Mauritania and very many other countries have
multiples interest free Islamic Eanks in their
countries over decades. My dissertation however,
explained in details the nature and relevance of
Islamic Banking System to the Nigerian Populace in
particular and the world in general, my prayer is
that Nigerian Government would have second though and
establish the interest free Banks in the country
for the benefits of all.
Description
A TRESIS SUBMITTED TO POSTGRADUATE
SCHOOL AHMADU BELLO UNIVERSITY,ZARIA
IN PARTIAL FULLFILMENT OF THE AWARD
OF MASTER BUSINESS ADMINISTRATION
(MBA) ABU ZARIA OF THE 1991/92
SESSION.
DEPARTMENT: BUSINESS ADMINISTRATION
FACULTY: ADMINISTRATION,
AHMADU BELLO UNIVERSITY
ZARIA
NOVEMBER, 1992
Keywords
ROLE, ISLAMIC, BANKING SYSTEM.