Youths urged to understand Islamic financing : Nikolaus R Shwarz: CEO FDIB

 

The Chief Executive Officer of the First Dawood Islamic Bank, Nikolaus R Shwarz, Wednesday called upon the young generation to acquire knowledge and understanding of the Islamic mode of financing as they would be the real agents of change for the transformation of the society.

In his inaugural address at a one-day workshop on 'Diminishing Musharka,' at the Institute of Bankers, Pakistan here, he said the Islamic banking system is getting recognition world over. He said the number of Islamic banks, subsidiaries and branches was increasing in the world not only in the Muslim countries but also in the non-Muslim world.

During the last three decades, the Islamic financial systems started emerging at the global level and gradually got recognition. During the last 10 years, he said, the Islamic banking rose by around 15 percent in the world.

Referring to the Pakistan market, he said the number of banks, exclusive Islamic banking branches, or subsidiaries and complete Islamic banks were entering into the market and more were expected during the next one and two years.

He said it is the society, which would help in transforming from conventional banking system to the Islamic Riba-free banking system.

Earlier, Chief Executive of the IBP, Muhammad Saleem Umer in his introductory remarks and address of welcome said the Institute is gradually increasing its emphasis on Islamic banking because this segment was increasing in the sector." The need for knowledge, exchange of experiences and discussions about the ground realities, perceptions and realities had increased manifold, necessitating more courses, workshops and discussions on the Islamic banking," he remarked.

Later, starting the technical session, Head of Islamic Banking of an international bank, Muhammad Imran spoke on the topic and explained the concept, types, Shariah principles and process.

He said the diminishing Musharka is a form of partnership in which one of the partner promises to buy the equity share of the other partner gradually until the title to the equity is completely transferred to the buying partner. The transaction starts with the formation of a partnership, after which buying and selling starts with the formation of a partnership. The "Buying and selling" is independent of the partnership contract and should not be stipulated in the partnership contract since the buying partner is only allowed to give merely a promise to buy. It is also not permitted that one contract be entered into as a condition for concluding the other, he explained.

Removing the general perceptions about the Islamic banking system, he said it is wrong that Islam is just a religion and nothing to do with the banking system.

Giving references from the Holy Quran and Hadith, he said the economic aspect reigned supreme in the whole philosophy of Islam.

Talking about "Sura Quraish" he explained that the Ailaf agreement between Quraish and Roman Empire for the safe passage from Makka to Syria was nothing but an economic activity. As the economic conditions of the people of Arab were dependent upon the trade caravan leaving from Makka to Syria to attend winter and summer trade fairs.

"Islam is strongly related to economy and there were established share holding companies and Hazrat Abbas, one of Uncle of the Prophet (PBUH) was actually a banker and used to lend money for interest. The workshop was attended by bankers and others

Courtesy : Business Recorder

 
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