6 Requirements for Islamic Finance Contracts

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Date: 2018-11-03 19:43

The Securities and Commodities Authority (SCA) has defined six requirements for Islamic finance contracts, in order to be in accordance with the principles and rules set out in Sharia law, such as the lack of riba and games money, and that the contract has no effect, Includes two sales in a bid – ah.

She pointed out that the Islamic financial sector has proven its importance at the global level and has emerged from the global financial crisis with minimal losses.

Islamic finance

In particular, the Securities and Commodities Authority (SCA) confirmed that the monitoring of the global financial crisis and the reasons for its impact and development have shown that the Islamic finance sector has suffered far less losses than conventional financing. Most policymakers, experts and economists have called for Islamic finance. It has proven to be effective and widespread and has been the least damaging of the global financial crisis.

Basic pillars

The Authority said in a statement that the Islamic banking model was based on three fundamental principles: the first is the goal of sharia, namely the need to respect all the rules governing the areas of economic exchanges, so that the activity of economic relations is not prohibited in itself or does not serve the public interest.

The second is constituted by the "mechanisms", which include all the authorized formulas and serve as legal and juridical cover to adapt and codify the structure and the exchange relationship in accordance with the provisions of the Islamic Sharia. The third pillar is the "mechanism", which means the desired outcome of the economic exchange process. Funding is realized in the interest of the individual and society.

Assets and rules

"When considering the forms of financing provided by financial institutions on the basis of their compatibility with the provisions of Islamic law, it is necessary to study these contracts, taking into account the rules and regulations set forth by the Islamic law, such as the free contract of wear, which was forbidden in the Qur'an,: (And God sold the sale and forbid wear). And do not include any kind of (play) as the Almighty has said: (but alcohol and the monumental and horrible games and abominations of the devil Vajtnboh's work) Gharr), as it was reported by the Prophet – peace be on it – that: (forbidden Gharar) He also pointed out that the contract did not include a forbidden order, in addition to the fact that it did not include two sales in one bid & # 39; ah, as forbidden the prophet (peace and blessings of Allah on him).