Islamic finance instruments are those which are compliant with the shar’iah or Islamic jurisprudence. Shar’iah prohibits certain aspects like riba (usury), maisir (gambling), etc., which are against morality. Three principles like principle of equity, participation and ownership are found to rationalize Islamic finance. There are multiple Islamic Financial products that are now in vogue globally. Instruments of Islamic finance are not referred to as “loans’ but rather as financing modes falling under one of the three categories: Profit-and-loss sharing (PLS), non-PLS contracts, and fee-based products. The article also discusses a number of models of Islamic financing that are currently available in the markets.
Volume 11 | 08-Special Issue
Pages: 3296-3299