The Green Crescent on Stock Horizons (Part 2)
Sharia Lessons for Financial Planning
Equal sharing of risks by lenders and borrowers is just one of the tenets of Islamic banking. It is not only contemptuous, but erroneous as well, to dismiss the idea of interest-free funding as a flight of fancy. The sub-prime crisis of 2007 would not take place in an Islamic finance format. Islamic bankers are conscientious: they would not sell loans at premium rates of interest to customers considered to be unworthy of loans, and then sell these bad debts to their business friends! Islamic finance is a form of stock investment, because lenders roll up their sleeves and help clients with realistic business plans and contingency planning.
Sharia does not allow financiers to associate with socially irresponsible business. The United States took until 2007 to discourage some forms of electronic gambling, but Islamic banking has proscribed funding such activities since antiquity. People of all faiths and atheists as well can learn how to combine principles and stock investing through the path of Islam. Integrity is a driving force of Islamic banking: it is therefore more productive than huge severance packets for errant executives from our powerful financial institutions! Could this be why some western banks now offer Islamic banking products?
Please join our forum and tell us what you think of Islamic finance? Has your banker ever taken you for a ride, selling you plastic and then loans you could not afford? Would you like to locate Islamic banking? Write and let us know!