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A Brief Review & Introduction to Practiced Islamic Banking & Finance

14 Pages Posted: 17 Jan 2010  

Salman Ahmed Ahmed Shaikh

Greenwich University

Date Written: January 14, 2010


This paper looks at the practiced Islamic finance and alternatives it offers for corporate finance managers in sourcing funds i.e. i) Ijara ii) Murabaha iii) equity modes like Musharakah and Mudarabah iv) Diminishing Musharakah, v) Salam and vi) Istisna. It also looks at alternatives for sourcing funds from savers to provide financing thereof by financialintermediaries i.e. i) Qard-e-Hasan ii) Musharakah and iii) Mudarabah. The paper also gives a brief account of literature on Islamic corporate finance, interest free finance, alternatives suggested in the past and their pros and cons, role of central bank in Islamic finance and alternatives for OMO, Interbank lending and money market in Islamic finance.

Keywords: Islamic corporate finance, pricing of capital, interest free finance, Interest, Interest free economy, Usury, Time value of money, Riba, Musharakah, Mudarabah, Ijara, Salam, Istisna, Qard-e-Hasan, Diminishing Musharakah

JEL Classification: G21, G30, G10

Suggested Citation

Shaikh, Salman Ahmed Ahmed, A Brief Review & Introduction to Practiced Islamic Banking & Finance (January 14, 2010). Available at SSRN: or

Salman Ahmed Shaikh (Contact Author)

Greenwich University ( email )

Karachi, Sindh
+92 021 35840397-98 (Phone)

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