Servet Bayindir and Murat Ustaoglu
Religious scripts strongly encourage acts of philantrophy and benevolence that contribute to achievement of social harmony and similarly condemn interest out of money. The views…
Abstract
Purpose
Religious scripts strongly encourage acts of philantrophy and benevolence that contribute to achievement of social harmony and similarly condemn interest out of money. The views paying attention to economic reasons fail to offer a plausible counter argument to this contradiction. Almost all studies since the inception of Islam have, rather than considering the dynamic social and economic realities of the time, attempted to justify the views on the ban. Thus, this study aims to provide clear aspect on Abrahamic religion’s approach on the issue.
Design/methodology/approach
This paper seeks to analyze how the Abrahamic religions approach the issue of interest. For the sake chronology, the Judaic approach will be first analyzed, referring to the main arguments that served as basis for the lift of the ban. Subsequent to the rational arguments raised in the Christian tradition that justified the ban, the reasons for the removal of the ban that changed the attitude of the church will be examined. Finally, based on its original sources, the approach of Islam will be evaluated and the current popular arguments will be discussed.
Findings
A review of the interest issue in the Abrahamic religions in a historical context reveals that there are visible similarities between the arguments that served as basis of the discussions. Christian scholars were able to justify the ban with reference to strong arguments; however, in reference to the conditions that the economy arguably dictated, the ban has been gradually lifted. A similar process has taken place among Islamic scholars as well. Those who adopt an economic perspective fail to consider the chief principles in Abrahamic religions that promote the practice of benevolence.
Originality/value
This paper seeks to analyze how the Abrahamic religions approach the issue of interest from a broader perspective. To this end, the authors offer a general framework of the notion of interest and present the approaches of Abrahamic religions to the concept through reference to popular arguments.
Details
Keywords
Zeyneb Hafsa Orhan, Sajjad Zaheer and Fatih Kazancı
This paper aims to achieve two goals: first, to evaluate the existing interest-free monetary policy tools in the major Islamic financial hubs of Malaysia, Pakistan and Bahrain…
Abstract
Purpose
This paper aims to achieve two goals: first, to evaluate the existing interest-free monetary policy tools in the major Islamic financial hubs of Malaysia, Pakistan and Bahrain and; second, to suggest how monetary policy tools in Turkey can be used in other countries.
Design/methodology/approach
This study follows a qualitative research method based on literature review, comparison, evaluation and design.
Findings
The policy rate cannot be used due to Shariah concerns. The reserve requirement depends on qard, and the reserves should be kept separately in the central bank. In terms of ijarah sukuk, Shariah concerns should be taken into account and a new structure, as displayed in Figure 3, should be followed. Government investment certificates can be used as an interest-free monetary policy tool. A genuine mudarabah interbank investments can also be used. Wadiah acceptance with no habitual gift can be used as well, and Tawarruq and central bank notes are not preferable due to Shariah concerns as well. Having said that, a Turkey-based tawarruq platform can be structured for others to use instead of applying to London.
Originality/value
This paper’s unique suggestion is to develop an interbank taqaruz market and a taqaruz method with the central bank. It is also unique for Turkey in the subject.