The document discusses Islamic banking principles and concepts. Some key points are: Islamic banking adheres to Sharia law and prohibits interest, investing in industries like alcohol and gambling. Major concepts include musharakah (joint venture), mudarabah (investment partnership), murabaha (profit-sharing trade), and sukuk (Islamic bonds). The main difference between Islamic and conventional banking is that Islamic banking follows Sharia law and avoids interest.

2. Presented To: Mr. Junaid Haider
Presented By:
Uzair Tauqeer (BBA IV)
Saba Amjad (MBA II)
Sunia Rani (MBA II)

4. BANKING
• In general terms, the business activity of
accepting and safeguarding money owned by
other individuals and entities, and then
lending out this money in order to earn a
profit.

5. Islamic banking
• Islamic banking refers to a system of banking
or banking activity that is consistent with the
principles of Islamic law (Sharia) and its
practical application through the development
of Islamic economics.

6. Main Principles
• The prohibition of taking or receiving interest.
• Capital must have a social and ethical purpose.
• Investments in businesses dealing with alcohol,
gambling are deemed undesirable and prohibited.
• A prohibition on transactions involving masir
(speculation or gambling).

8. Musharakah
• Musharakah (joint venture) is an agreement
between two or more partners, whereby each
partner provides funds to be used in a
venture.

9. Mudarabah
"Mudarabah" is a special kind of partnership
where one partner gives money to another for
investing it in a commercial enterprise.

10. Murabaha
• This concept refers to the sale of goods at a
price, which includes a profit margin agreed to
by both parties.

11. Wakalah (power of attorney)
• This occurs when a person appoints a
representative to undertake transactions on
his/her behalf.

13. Hibah (gift)
• This is a token given voluntarily by a debtor to
a creditor in return for a loan.
• Hibah is a voluntary payment made (or not
made) at the bank's discretion, and cannot be
'guaranteed.'

14. Ijarah
• Ijarah means lease, rent or wage. Generally, Ijarah
concept means selling the benefit of use or
service for a fixed price or wage.
Sukuk (Islamic bonds)
• Sukuk, plural of Sakk, is the Arabic name for
financial certificates that are the Islamic
equivalent of bonds.
• Sukuk are securities that comply with the Islamic
law (Shariah) and its investment principles, which
prohibit the charging or paying of interest.

15. Takaful (Islamic insurance)
• Takaful is an alternative form of cover that a
Muslim can avail himself against the risk of
loss due to misfortunes.

17. Islamic VS Conventional Banking System
• Product
• Basis
• In case of loss
• Funds Distribution
• In case of Inflation
• Expansion of Money
• Real growth of wealth