Because of this, Al Rayan Bank’s circumstances bring consumers the high quality regulatory user safety
Islamic loans Frequently asked questions
Islamic banking is actually similar to the values of Sharia. An option basis is that they works instead of focus, that is not let when you look at the Islam, as the money itself is not considered to be an item of which you could cash.
The brand new Islamic bank operating system spends actual trade situations recognized with real assets. Thus Islamic financial institutions, including Al Rayan Lender, don’t conduct business unless they have a valuable asset so that the transaction as achieved.
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Islamic finance companies also are not permitted to use economic devices you to definitely are derived from conjecture, and therefore present a premier section of risk so you can a financial, and also the assets and you will dumps of the consumers. Through which advantage-recognized method, Al Rayan Lender, and you will Islamic financial general, isn’t confronted with a comparable risks given that traditional banking institutions. For that reason this new Islamic financing community turned out to be an enthusiastic ethical and resilient replacement for antique banking adopting the recent economic drama.
Al Rayan Bank has the benefit of defense and you can stability so you’re able to its people since it is section of a larger Islamic lender entitled Masraf Al Rayan (MAR). This gives Al Rayan Lender economic decisive hyperlink balance and additionally supply so you’re able to expertise and you can degree to carry on development the listing of Sharia compliant merchandising lending products.
In addition, while the a British lender, Al Rayan Lender try authorised by Prudential Managed Expert (PRA) and you will managed by the Economic Make Authority as well as the PRA, which means it ought to see all the Uk banking guidelines. Like, Al Rayan Financial savers who set the deposits into Bank is actually covered by brand new Financial Properties Payment Plan.
Its lack of need for Islamic financing is one of the key factors you to definitely differentiate Islamic banks out of traditional banks. Although not, there are many more extremely important variations:
- Islamic banking was house-backed and therefore an enthusiastic Islamic lender will not carry out company until a valuable asset is bought to let the transaction in order to end up being presented predicated on Sharia.
- The business investments therefore the winnings Islamic banks make can not be in/out-of companies that are thought unlawful under Sharia, i.epanies one to contract into the interest, gaming, porn, speculation, cigarette and other products contrary to Islamic viewpoints.
- The entire properties of Islamic banking is always to bring a way to own society so you can perform their finances in a fashion that is actually moral and you may socially in charge. Exchange, entrepreneurship and exposure-revealing was recommended and these will be economic standards one underpin Islamic funds additionally the products provided by Al Rayan Bank.
- Islamic banks have a beneficial Sharia Supervisory Panel to be sure most of the transactions and operations are based on Sharia and you will ethical values.
The newest Qur’an helps it be clear that focus, or riba, is actually forbidden. Antique banking, which is attract oriented, are therefore maybe not suitable for Muslims. The brand new Qur’an really does enable trade as a method off generating wealth referring to the cornerstone to possess Islamic financial. They operates versus interest to give recognized Sharia agreeable borrowing products. These are according to Islamic fund beliefs related to trading, such as for example leasing, investments and you can commitment.
Which have Islamic banks Muslims can help to save their funds, pick their houses and you will manage the time to time financial into the good Sharia agreeable ways. Particular Muslim consumers stay with conventional financial institutions and just don’t keep the interest they earn. Yet not, whatever they will most likely not see is the fact, indirectly, this may promote financial support for other users getting situations that are perhaps not let in the Islam, plus attention-built credit. Like, good Muslim owner’s places could be partially, or completely, used to render an interest-founded financing to pay for a casino otherwise brewery. This is not allowed considering Sharia.