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Every Day Economic Matters and Islam - awaisaftab - 04-04-2009

The fundamental concept of capitalist economy is the creation of consumption oriented society. So a culture of maximum consumption,greediness and desires of getting more and more material things normally found in a capitalist economy. It is not a desirable situation for any economy in general and an Islamic society particularly.

Banking sector of Pakistan is considered the most profitable sector for investment in last few years huge foreign investment has made in the banking sector. Even now-a-days when the global economic recession has badly effected the intentional banking industry many multinational investment groups are willing to invest in the banking sector of Pakistan. The most quotable example is the ever increasing branches network of Bank Alfallah. The main reason of becoming most favorite sector for investment is the prevailing high interest rates and service charges.

The above was the preview of the banking sector of Pakistan, now we come back to our main topic.

The emergence and development of banking sector brought many harmful interest based banking products. Such as car leasing, credit cards,home financing and many other products.

Among all the newly introduced banking products the credit card is most harmful. When one has an opportunity to buy from luxurious items to food stuff through credit card he uses it freely without concerning the consequences that he can encounter.

The use of different banking products and insurance according to Islamic point of view is as follows

1.Credit Card cannot be used in any way because the involvement of interest in credit card transaction is obvious.

2.Car leasing and home financing facilities cannot be acquired from traditional banks however these facilities can be obtained from Islamic Banks.

3.The trading of prize bonds and the prize money won on prize bonds is haram.

4. Insurance is also prohibited in Islam.
There are 3 reasons of its prohibition
i. The premium amount collected from policy holders usually invested in usurious businesses.
ii. It involves the factor of chance for instance one of thousand of policy holders can encounter with indemnified incident i.e accident,death,loss, natural disaster,occurrence of fire fluid etc. So it has resemblance with gambling
iii.In case of Life insurance policy money is transferred to only one person whose name had nominated by the deceased person in insurance documents and not accordance with the law of inheritance of Islam.
Some Companies provide the medical insurance facilities to their employees and their family members. This facility can be availed by an employee.
Here I also want to draw attention of all Muslims toward the payment of zakar which is most ignored Rukun of Islamic Sharia.

The employment of insurance and banking companies is also prohibited by Islam but the group of enterprises running business of insurance and banking and their income from these businesses is not more than 50% of consolidated income of group then employment in such businesses is allowed by Islam.

The life of this world is temporary and the life of hereafter is permanent. Being Muslims we should follow all teachings of Islam.


Courtesy By

Awais Aftab.