Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects

Equity financing seeks to achieve mutual sharing of risks pertaining to the enterprise and an equitable distribution of the return. Application of equity financing modes in Islamic banking is seen to be less developed, and configured in a manner that downplays their true potential. Some equity modes...

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Main Author:	Sadique, Muhammad Abdurrahman
Format:	Conference or Workshop Item
Language:	English English
Published:	2010
Subjects:	HG1501 Banking HG3691 Credit KBP173.25 Islamic law and other disciplines or subjects
Online Access:	http://irep.iium.edu.my/7257/ http://irep.iium.edu.my/7257/1/17Sadique.pdf http://irep.iium.edu.my/7257/4/7257.pdf

id	iium-7257
recordtype	eprints
spelling	iium-72572013-11-17T10:51:00Z http://irep.iium.edu.my/7257/ Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects Sadique, Muhammad Abdurrahman HG1501 Banking HG3691 Credit KBP173.25 Islamic law and other disciplines or subjects Equity financing seeks to achieve mutual sharing of risks pertaining to the enterprise and an equitable distribution of the return. Application of equity financing modes in Islamic banking is seen to be less developed, and configured in a manner that downplays their true potential. Some equity modes in vogue embody aspects more reflective of debt financing. Continued operation of these modes could not be expected to realise the fruits of Islamic economic ideals. To promote equity modes, some restriction should be introduced on the proliferation of debt-based schemes in areas of financing. Equity modes currently utilised could be further upgraded to ensure sharī‛ah compliance while realising their socioeconomic objectives. The aspect of existence and availability of capital at the formation of equity partnership should be reassessed, as considerable emphasis has been placed on it in shari‘ah. The mechanism employed by Islamic banks in deciding the ratio of profit sharing may require further refinement. Adopting an equity format could solve problems faced in debt-based project financing from an Islamic perspective, in addition to realising justice and fair play. 2010-06-15 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/7257/1/17Sadique.pdf application/pdf en http://irep.iium.edu.my/7257/4/7257.pdf Sadique, Muhammad Abdurrahman (2010) Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects. In: International Conference on Islamic Banking & Finance: Cross Border Practices & Litigations , 15-16 June 2010, IIUM. (Unpublished)
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English English
topic	HG1501 Banking HG3691 Credit KBP173.25 Islamic law and other disciplines or subjects
spellingShingle	HG1501 Banking HG3691 Credit KBP173.25 Islamic law and other disciplines or subjects Sadique, Muhammad Abdurrahman Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
description	Equity financing seeks to achieve mutual sharing of risks pertaining to the enterprise and an equitable distribution of the return. Application of equity financing modes in Islamic banking is seen to be less developed, and configured in a manner that downplays their true potential. Some equity modes in vogue embody aspects more reflective of debt financing. Continued operation of these modes could not be expected to realise the fruits of Islamic economic ideals. To promote equity modes, some restriction should be introduced on the proliferation of debt-based schemes in areas of financing. Equity modes currently utilised could be further upgraded to ensure sharī‛ah compliance while realising their socioeconomic objectives. The aspect of existence and availability of capital at the formation of equity partnership should be reassessed, as considerable emphasis has been placed on it in shari‘ah. The mechanism employed by Islamic banks in deciding the ratio of profit sharing may require further refinement. Adopting an equity format could solve problems faced in debt-based project financing from an Islamic perspective, in addition to realising justice and fair play.
format	Conference or Workshop Item
author	Sadique, Muhammad Abdurrahman
author_facet	Sadique, Muhammad Abdurrahman
author_sort	Sadique, Muhammad Abdurrahman
title	Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
title_short	Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
title_full	Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
title_fullStr	Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
title_full_unstemmed	Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects
title_sort	transition of islamic banks from debt-based modes to equity-based financing: issues and prospects
publishDate	2010
url	http://irep.iium.edu.my/7257/ http://irep.iium.edu.my/7257/1/17Sadique.pdf http://irep.iium.edu.my/7257/4/7257.pdf
first_indexed	2023-09-18T20:16:34Z
last_indexed	2023-09-18T20:16:34Z
_version_	1777407827493519360

Transition of Islamic banks from debt-based modes to equity-based financing: issues and prospects

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