Building awareness about Islamic Finance
By Dr Khawla Nobani – Jordan
Growth in Islamic finance institutions around the world is promising and is starting to acquire an ever-expanding share of the financial market. But it needs to be well co-ordinated and be part of the bigger concept of the Islamic economy, becoming part of the broader Islamic civilization and model; a model that offers solutions and an alternative to the current financial system.
Islamic institutions need to offer a complete cultural and working alternative to the current conventional system that offers easy capital and liquidity without taking the real economic cycle into consideration.
It worth mentioning that understanding the principles of Islamic finance is not limited to professionals only. However, we need to build a popular base, allowing as many potential customers as possible to see the benefits of Islamic finance’s core principles. Concerted effort in this direction can prove that the Islamic economy is able to provide alternative solutions and achieve major positive changes within the system, moreover adding value to everyday economic dealings.
Creating awareness about Islamic finance should focus on the flexibility of its products and provide a deeper understanding of the purposes of the legislation, requiring institutions who can represent modern Islamic finance. This will work towards a fairer society.
In my opinion, joint efforts must be taken by both the private sector (such as banks and Islamic finance companies) and the public sector, and include Zakat, Waqf, and charitable institutions to reflect the practical – and not only theoretical – concepts of Islamic finance.
No doubt about it, Islamic finance has global appeal and should not be limited to our Islamic world; hence, it is not restricted to Muslims only, but there is a humanist requirement to achieve ‘justice’ in investment and, above all else, ethical dealings. These significant features can’t be found in a capitalist system, which depends on maximizing wealth in the hands of the few, and provides access to easy capital and liquidity without taking into consideration the real economic cycle.
Building awareness about Islamic finance – and the Islamic economy as a whole – needs serious effort by public and private institutions, in addition to comprehensive communication and strategic planning. This should be followed by a continuous review process according to the overall objectives and duration of the plan.
With the current political turmoil that surrounds us, and the ever increasing financial and public needs, Libya and other countries are taking steps to move towards converting their economic system from ‘conventional’ to ‘Islamic’. It is foreseen that these major changes to the Libyan system will take place during 2015. The preparation period must take improving public awareness and understanding into consideration as a high priority, primarily to avoid any confusion, and to get ready to plant the seeds of the ‘real’ economy.