Legal frameworks implemented by Muslim governments and Shari'ah resources will be found in this section.
Shari’ah is the body of Laws which Allah prescribed for His servants through Prophet Muhammad (PBUH). Fiqh is the knowledge of the rules of Shari’ah. A “Fiqh” is the one who is knowledgeable to these rules and their relevance to changing circumstances.Read »
Shariah restrictions on certain financial and trade transactions is the raison d’être for the emergence of Islamic banking. It is, therefore, important for any student of Islamic banking to grasp the basic elements of the Islamic law of contract.Read »
Salam is a sale forward contract intended from the very beginning to be a mode of finance. It was known before the time of prophet Muhammad (PBUH), so Shari’ah came with rules governing this kind of arrangement. In a ordinary sale contracts, price and object of contract may be exchanged simultaneously which makes a spot sale. If goods sold are delivered while price is deferred, it will then be an installment sale contract. Salam however, is a sale contract where price is advanced while delivery of goods is deferred, in a fashion similar to “Futures” in modern commodity market. Salam used to be the mainstay in agriculture finance. Where farmers sell their crop at the time of planting. Nevertheless, its use is not restricted to agriculture, rather it can be used for any form gible non- manufactured goods. The advantage of the salam contract, compared to murabaha in that the bank can advance money to its client which can be used to satisfy clients needs of liquidity.Read »
Shari’ah Parameters for Islamic Finance ContractsRead »