Islamic Banking vs Conventional Banking

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  • Topic: Islamic banking, Bank, Sharia
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  • Published : March 22, 2011
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CORPORATE FINANCE

PROJECT TITLE:

ISLAMIC BANKING SYSTEM VS CONVENTIONAL BANKING IN PAKISTAN

SUBMITTED TO:
MR. MUBEEN KHALID

SUBMITTED BY:
KHALID WASIM
09-MPA-M-23

HAFIZ MUHAMMAD AHSEN
09-MPA-M-19

SEMESTER: 3RD

INSTITUTE OF ADMINISTRATIVE SCIENCES,
UNIVERSITY OF THE PUNJAB.
ACKNOWLEDGEMENT

We, wholeheartedly show our gratitude to our esteemed teacher, Mr. Mubeen Khalid, who gave us this good opportunity for advancement in our Corporate Finance course by undergoing this assignment to unearth the state of affairs especially in Islamic Banking System Vs Conventional Banking in Pakistan.

We are obliged to have unconditional support by our teacher who made us prepared and equipped with all the essential knowledge to carry out this task more efficiently and dig out the best information out of all our research on the assignment which will be adequately serving us and our friends to add up to our treasured knowledge.

PROJECT DETAILS

Our project is designed to reveal the detailed information regarding Islamic Banking System and Conventional Banking especially in Pakistan.

Knowing about Islamic Banking System is the basic objective of our project, so that we can have a peep into the Islamic Financing System which is progressing day by day. Moreover we have also described conventional banking.

Right from the start, our efforts were put in together to collect the true knowledge of state of affairs being practiced in the Islamic banks. For this purpose we visited Meezan Bank Gulberg Main Boulevard branch. We found out references to enter the organization and gather as much information as we could. We contacted Mr. Muhammad Bilal Malik Officer Car Ijarah and Mr. Bilal Ahmed Officer House Building Finance at Meezan Bank Gulberg Main Boulevard branch. We had a set of questions with us to which we needed fair answers, so we had a reliable source in the organization.

All that we could gather through our research in this task is visible here in the form of final project.

TABLE OF CONTENTS

* ISLAMIC BANKING
* ISLAMIC BANKING GLOBAL SCENARIO:
* ISLAMIC BANKING IN PAKISTAN
* STRATEGIC PLAN FOR ISLAMIC BANKING INDUSTRY IN PAKISTAN BY STATE BANK OF PAKISTAN * MODES OF ISLAMIC BANKING
* CONVENTIONAL BANKING
* ISLAMIC BANKING VS CONVENTIONAL BANKING
* MAJOR DIFFERENCES BETWEEN ISLAMIC AND CONVENTIONAL BANKING SYSTEM * THEORETICAL COMPARISON
* CAR LEASING VS CAR IJARAH
* MOTIVATING FACTORS FOR ISLAMIC BANKING
* OPERATIONAL CHALLENGES AND PROSPECTS
* CONCLUSION
* REFERENCES

Islamic banking is based on the principles of Islamic economics — an economic framework in accordance with Islamic law (Sharia'h). There are two types of Islamic economics:

* Caliphate , the Islamic form of government representing the political unity and leadership of the Muslim world (Islamic
political framework)

* Assuming the political framework is non-Islamic, therefore, seeking to integrate some prominent Islamic tenets into a
secular economic framework.

ISLAMIC BANKING:

Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia’h) principles and guided by Islamic economics. In particular, Islamic law prohibits usury, the collection and payment of interest, also commonly called riba. Generally, Islamic law also prohibits trading in financial risk (which is seen as a form of gambling). In addition, Islamic law prohibits investing in businesses that are considered unlawful, or haraam. Islamic finance has been gaining momentum on a global scale for the last 30 years.

Many Islamic Banks have sprung up over the last few years. These changes are occurring both in Muslim and in western countries, and are driven by a global trend amongst Muslims to become more
observant of their faith. It might have been the reason why Islamic Banking emerged, however, today Islamic Banking is sought by...
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