THE EVOLUTIONS OF ISLAMIC FINANCE IN MALAYSIA
Islamic finance is the provision of financial services on a basis that is compliant with the principles and rules of Islamic commercial jurisprudence and a branch of Islamic Shari’ah jurisprudence. This means, all the operations in the bank must base on Shari’ah jurisprudence including of remittance business, letter of guarantee, letter of credit and foreign exchange. The main factor that differentiating between Islamic bank and conventional bank is all his business are conducted without any elements of interest. Interest also known as riba in Islam. This is because Islam prevent Muslim to give and take riba in all matters. Other than that, the main objective establishment of Islamic banks to meet the needs of Muslims in the banking business. Basic business operations is also based on the resolution of Al-Quran and Hadith, which is based on the concept of fair and in the interest of society. The concepts of Islamic finance also means of prohibition pf fixed return, profit and loss sharing and hence risk sharing, prohibition of gharar ( uncertainty ), speculation and gambling.
HISTORY OF ISLAMIC FINANCE IN MALAYSIA
At the Kongres Ekonomi Bumiputera in 1980, the Lembaga Urusan dan Tabung Haji be allowed to establish Islamic banks that aim to collect and invest the money belonging to Muslims.
Government urged to take immediate action to establish laws for the establishment of banks and financial institutions that operate based on the principles of Islam.
30 July 1981
The government has established Jawatankuasa Pemandu Kebangsaan Bank ...
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...titutions that deal in a financial system also has advantages in terms of competitiveness. Therefore, the banking institutions in Malaysia will increase the competitiveness and quality of service and quality of their products to attract customers.
ESTABLISHMENT OF LEMBAGA TABUNG HAJI
Lembaga Tabung Haji board established in 1969 to save money savings Muslim community who want to perform hajj. Hajj affairs fund administered by the laws of shariah. Lembaga Tabung Haji are increasing, particularly in diversified towards investments that will generate revenue and profits.
Zakat is the amount of certain property required gods to persons entitled to receive in addition to producing a certain amount itself. Zakat laws of each state in Malaysia enacted by the Majlis Perundangan Negeri, respectively. Zakat can prevent a Muslim from jealousy and greed to others.
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