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Islamic Finance and Banking: Modes of Finance

Learn about the different modes of Islamic Finance and the applications, management and risk involved with each.

Islamic Finance and Banking: Modes of Finance
This course is archived
Estimated 4 weeks
3–4 hours per week
Progress at your own speed
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About this course

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This Islamic finance and banking course gives an overview of the Islamic modes of finance. In this course, you will learn about Murabaha, Ijarah, Salam, Iistisjna, and Istisjrar modes of finance and their applications, management, the risks involved, and the mitigation measures.

You will also learn about the nature of Islamic banking systems and categories of Islamic Financial Institutions (IFIs).

No previous knowledge is needed.

At a glance

  • Language: English
  • Video Transcript: English

What you'll learn

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  • Introductory overview of Islamic finance and banking
  • Various Islamic modes of finance
  • Equity-based and fee-based contracts
  • Intermediation contracts in Islamic Finance

Week 1 - A Framework for the Islamic Financial System-Part 3
Introductory overview of Islamic finance and banking

  • Leasing or Ijarah Contracts
  • Conventional vs Islamic Leasing
  • Issues in Modern Ijarah Contracts
  • The Concept of Ijarah Sukuk
  • Deferred Delivery or Salam Contracts
  • The Istisna‘a Contract
  • The Istijrar Contract

Week 2 - A Framework for the Islamic Financial System-Part 4

  • Shirkah and its Two Categories
  • The Concept of Mudarabah
  • The Concept of Musharakah
  • The Wadiah Wad Dhamanah Deposit
  • The Qard-ul-Hasan Deposit
  • The Concept of Wakalah (Agency)
  • The Concept of a Tawarruq Contract
  • The Concept of a Ju’alah Contract

Week 3 - Islamic Banking System and its Financial Products

  • Financial Intermediaries: Their Three Main Functions
  • Intermediation Contracts Permitted by the Sharī‘ah
  • Trust-based Intermediation Contracts
  • Security-Based Intermediation Contracts
  • Business Models for Islamic Financial Institutions (IFIs)
  • Theoretical Perspective of an IFI’s Balance Sheet
  • Categories of IFIs

Week 4 - Controversial Financing and Fee-based Products

  • Bai’ al-Einah (Repurchase)
  • Bai’ al-Dayn (Bill Discounting)
  • Tawarruq
  • The Use of Wakalah to Provide a Letter of Credit
  • The Use of Kafalah to Provide a Letter of Guarantee
  • Other Fee-based Services

About the instructors

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