Debt Instruments in Islamic Finance: A Critique

Ebrahim, M.S.; Sheikh, M.

doi:10.1163/15730255-12341317

Debt Instruments in Islamic Finance: A Critique

Ebrahim, M.S.; Sheikh, M.

Authors

Professor Muhammed Ebrahim m.s.ebrahim@durham.ac.uk
Professor

M. Sheikh

Abstract

This article assesses the employment of traditional Islamic debt instruments by contemporary Islamic banks from an economic efficiency perspective. We highlight the fact that the performance of the bulk of the instruments pales in front of the modern facility of participating preferred ijāra. Thus, the shortcomings of the traditional instruments illustrate that the future does not augur well for either the Islamic banking industry or the emerging Muslim economies. For the Muslim world to move beyond its current malaise, it is necessary to scientifically restructure its financial intermediation system in such a way as to meet the challenges of the modern age also conforming to the spirit of the Sharīʿa.

Citation

Ebrahim, M., & Sheikh, M. (2016). Debt Instruments in Islamic Finance: A Critique. Arab Law Quarterly, 30(2), 185-198. https://doi.org/10.1163/15730255-12341317

Journal Article Type	Article
Acceptance Date	Jul 29, 2015
Online Publication Date	Feb 24, 2016
Publication Date	Feb 24, 2016
Deposit Date	Jul 30, 2015
Publicly Available Date	Feb 24, 2018
Journal	Arab Law Quarterly
Print ISSN	0268-0556
Electronic ISSN	1573-0255
Publisher	Brill Academic Publishers
Peer Reviewed	Peer Reviewed
Volume	30
Issue	2
Pages	185-198
DOI	https://doi.org/10.1163/15730255-12341317
Public URL	https://durham-repository.worktribe.com/output/1402034
Publisher URL	10.1163/15730255-12341317