Maqasid-al-Shari‘ah vs. Contemporary Islamic Banking and Finance

Abstract

One of the cardinal issues in Islamic banking and finance is how to reconcile the objectives of Islamic moral economy and observed current reality? The skeptics argue that Islamic banking and finance is not contributing towards the universal goals of Islamic economic system and the paradigm contains similar moral hazards like conventional banking system. The study documents the underlying flaws and contradictions of the present-day Islamic banking with regard to maqasid-alshari‘ah. Further, the study also recommends reforms in few key areas of Islamic banking to align the goals of Islamic moral economy and contemporary Islamic banking in Pakistan.

Keywords

• Islamic Banking
• Maqasid-al-shari‘ah
• Qur’ān
• Sunnah
• Pakistan
• risk