Emerging in the 20th century, Islamic finance has grown substantially in recent decades across the world, becoming one of the fastest growing financial industries.
Today, it has global assets exceeding $2 trillion and expected to reach $3.8 trillion by 2023.
Acknowledging the growing interest in Islamic finance, a leading British university has introduced the first Accounting and Islamic Finance undergraduate course in the UK.
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Students at the Birmingham City University taking the BSc (Hons) Accounting and Islamic Finance degree will study Islamic economics. They will also work on developing an understanding of corporate social responsibility in modules exploring how businesses move towards a cleaner and more sustainable planet.
“The course is being launched at a very crucial time in our history,” course leader Shaista Mukadam told The Business Desk.
“With the current pandemic and economic challenges, there is an urgent need to rethink an alternative to the interest-based economy.”
Sharia-compliant finance differs from conventional banking in key ways, the most notable being a prohibition on charging interest and investing in ethically compliant companies.
Islamic banks and finance institutions cannot receive or provide funds for anything involving alcohol, gambling, pornography, tobacco, weapons or pork.
Shari`ah-compliant financing deals resemble lease-to-own arrangements, layaway plans, joint purchase and sale agreements, or partnerships.
The global Islamic banking market covers different aspects, like Islamic Banking, Takaful: Islamic Insurance, Sukuk: Islamic Bonds, and Shari`ah Capital Market: Islamic funds.
“Islamic finance uses tools to ensure a fair and equitable distribution of wealth, resources and growth based on profit, loss and risk-sharing while achieving the United Nations sustainable development goals and ensuring ethical and sustainable processes in business and finance,” added Shaista, a senior lecturer at Birmingham City University’s Business School.
“Students on the course will be taught the philosophy around these principles and will be encouraged to find ways to implement them in real-world scenarios. It’s not just a course for Muslims, it’s about an ethical way of doing finance based on the teaching of Islam.”
The UK has a long-standing reputation as one of the world’s most important and innovative financial centers.
The City of London is the leading center for Islamic finance outside the Muslim world, with assets of UK-based institutions that offer Islamic finance services totaling more than $5bn.
In recent years, the UK has reinforced its position as the Western hub for Islamic finance. Today, more than 20 banks in the UK offer Islamic services, and five of these banks are fully Sharia-compliant, including Al Rayan Bank.
It is believed that more than 80pc of all fixed-term deposit customers of Al Rayan bank are not of the Muslim faith