Study Of Islamic Financial Institutions

In some sense, the reviving of Islam leads to the appearance of Islamic financial mechanism, which is based on the Koran, shari'Ah and Islam rules and comes into being a distinguished Islamic financial system. The political situation, the oil US dollar and the religion tradition have a great influence on the modern Islamic financial activities. In 1960's, It firstly appeared in Pakistan and Egypt. After a short time, it spreads several fields such as banking, insurance, investment and mortgaging. In 1970's,quite a few Islamic financial mechanisms were founded in Middle East, Africa, and Asia, Europe .America even Australia. That is to say in many countries all over the world. According to the experience of the secular financial mechanism, the modern Islamic scholars reform the old Islamic financial principles. Just like the secular financial mechanism, in order to get profit, they provide deposit and loan .They also use special investment patterns such as Murabaha. Musharak, Mudaraba , Istisna, Ijara, Bay'Salam, Bay'Muajjal and Muqarada to participate in investment activities which are different from the traditional and secular ones to assure the development of themselves .Because of short of ability to deal with other financial activities such as stock and insurance business, there is a long way for them to prefect them. As a new thing, there are many shortcomings, which prohibit their professional work and they must overcome them. For example; they are short of a unified authority institute and a unified accounting and auditing standard. Facing globalization, they will develop faster than ever and have little difference with the secular financial mechanism.