Islam is the final and most complete religion. It has the simplest and most comprehensive legislation, which covers all aspects of life as part of an integral unit in which creed and Islamic Sharia law cannot be separated, nor can rules and morality. It is an indivisible structure that cannot be founded on one pillar without the other. Consequently, the divine instructions of the Holy Quran that came through Prophet Mohammed (PBUH) highlighted the importance of this integration and unity in the establishment and sovereignty of the Muslim faith.
The Holy Quran is full of verses that exemplify this integration and bond between creed, Islamic Sharia law and morality. For example, there are the verses that prohibit usury: ‘O ye who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers. If ye do it not, take notice of war from Allah and His Messenger: but if ye turn back, ye shall have your capital sums; deal not unjustly, and ye shall not be dealt with unjustly. If the debtor is in a difficulty, grant him time till it is easy for him to repay. But if ye remit it by way of charity, that is best for you if ye only knew,’ (Surat al Baqara: 278-280).
In an authentic Hadith verified by Al Bukhari, the Prophet (PBUH) said: “Allah bestows mercy upon a servant who shows tolerance when selling, when buying, when lending and when borrowing.” Furthermore, Islam states that giving those in difficult financial circumstances time and facilitating matters for them is one of the reasons a person is granted forgiveness from God and entrance to paradise.
In an authentic Hadith reported by Abu Massoud, the Prophet (PBUH) said: “A man, from those who had lived before you, was judged for his actions. No good deeds were found to be done by him except that he was a rich man who would mix with the people, and he would say to his valets: pardon the insolvents. Thereupon Almighty God said to His angels: We are more entitled to do that than him, so pardon him.”
Granting time to- and facilitating matters for- insolvents is also one of the reasons why people will be sheltered by God’s throne on judgment day. In an authentic Hadith reported by Rabei who said that Abu al Yussr told him that he heard the Prophet (PBUH) say: “He who gives respite or grants remission, Allah will shelter him in the shade of his throne.”
Where does Islamic banking stand today in this regard? A good look at the reality of Islamic banking and its practices shows that it is as far away as it could be from such principles and morals. You can barely see any resemblance to these principles in the policies and procedures of Islamic banking. It has all vanished into thin air. Furthermore, Islamic banking is on the verge of surpassing conventional banking, with regards to certain practices, as the latter takes advantage of the weak situation of clients based on the contracts they signed at the very beginning. I believe these kinds of contracts are not satisfactory. I would like to mention two incidents within this context that clearly prove this, so as not to be levelling groundless accusations. Both incidents are related to two banks, the names of which I will keep to myself.
The first incident involved a Saudi bank and a friend of mine. He told me that he had wanted to bring forward a payment to settle a Murabaha sale, which he owed that bank, three months before it was due, without asking the bank to deduct from the profit in return for expediting the act of paying back. However, he was shocked that the bank demanded him to pay a sum of 750 Saudi Riyals on top of the actual debt in order to allow him to settle the payment quicker. It is as if the bank is punishing him for making the payment at an earlier date, and instead of thanking him for this and cutting back on his overall debt in return for speeding up the settlement, the bank did the exact opposite.
I am completely baffled by this strange conduct. How can anyone be penalised for wanting to pay back what they owe in order to clear their debt? Islam encourages debts to be cleared. The bank, which claims that this transaction is Islamic Murabaha, should have helped him carry out a request that is in line with Sharia. Moreover, these kinds of dealings cannot, in any way, be acknowledged by positive law, not to mention Islamic Sharia law which is impeccable, flawless and inspired by God.
However, if the supervisor fails to carry out his role, and the opponent becomes the judge, unbelievable incidents are bound to occur, injustice will spread and chaos will prevail.
The other incident that occurred involved an Islamic bank in the UAE, and the aggrieved party appealed to me for help. In fact, if the problem is a real one, then the incident definitely has no relation whatsoever to Islam. In brief, the person involved bought a car via the Islamic bank and paid instalments using bad cheques. As a result, the bank had his car impounded by the traffic police. There is no objection to that. At that point, the client talked to the bank and paid what he owed. Then he took a letter from the bank addressed to the traffic police in order to have his car returned. However, he discovered that the bank had already received the cheque and sold the car after it was cleared.
The problem is yet to be solved by the bank. At times it demands that he pay a certain amount of money to re-purchase the car, and at other times it demands that he pay exorbitant fees.
It is these kinds of incidents that harm the image of Islamic banking and go against the eternal principles of Islam. Consequently, it is impossible for us to present the current experience of Islamic banking as a perfect example of Sharia. It would be impossible for this type of Islamic banking to convey the eternal message of Islam in the way the early Muslim merchants did. Islam spread because of those people, without the sword, in countries such as those of East Asia.
For this reason, I call on all those involved in Islamic banking and religious institutions to incorporate the morals and essentials of Islamic dealings in the policies and procedures of Islamic banking. Moreover, they should take Islam as an incorporated entity without breaking it up, so that the image of our Muslim faith will not be tarred by these organs, and so that they may serve as a tool that defines the eternal creed of Islam.