The Religious Foundations of Islamic Banking

Abstract

The ideology of an Islamic financial system is based on the Islamic faith and must stay within the limits of Syariah in all of its actions and practices. Syariah is an Islamic religious law which emphasizes on moral, social, ethical and religious factors to promote equality and fairness in the society. The common perception is that the Syariah is merely a collection of do’s and don’ts, or just a code of criminal laws prescribing punishments for certain crimes. Though it covers both, but the scope is much broader and deeper, encompassing the totality of man’s life. The need to understand the Syariah and its sources is very important as it is the foundation of Islamic financial system.