Publication:
The foundations of Islamic finance and the maqasid al-Shari'ah requirements
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Date
2013
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Abstract
The emergence of Islamic finance as a system of thought and practice is timely in the midst of world crisis and the uncertain proposals for solving it. It is hoped that Islamic finance offers a coherent perspective for understanding real economic problems as well as a genuine alternative to the very foundations of how economics and finance should be managed to actualize human prosperity. In addressing those expectations and challenges, sufficient attention to the foundations should be given to develop solid conceptual scheme of a new finance in Islamic perspective and to resolve the tensions in the current development. This paper attempts to discuss the foundations of Islamic finance and the requirements in developing Islamic finance from the basic principles of maqasid al-Shari'ah (the objectives of Shari'ah). Islamic finance, in this perspective, must realize its full potential as a system, not merely a lawful means in doing financial business or a stopgap means of surviving the crisis. It must go beyond that to provide the guidelines for managing a good economy, stimulating growth and development, realizing socio-economic justice and promoting employment and stability as implied in the objective of Shari'ah (maqasid al-Shari'ah).
Keywords
Islamic finance , Foundations , Systemic approach , Formalistic approach , Maqasid al-Shari'ah
Citation
Laldin, M. A., & Furqani, H. (2013). The foundations of Islamic finance and the maqasid al-Shari'ah requirements. Journal of Islamic Finance, 2(1), 31-37.
Publisher
IIUM Institute of Islamic Banking and Finance