Islamic Finance: A Very Short Introduction

With a full scope of financial services, ranging from banking and capital markets to insurance and microfinance, Islamic finance has now become the most prominent form of faith-based finance in the world. After a period of double digit growth, the global assets of Islamic finance reached USD 2 trillion in 2015. Today more than 300 institutions are engaged in Islamic finance across the world. Despite this success, the field remains poorly understood.

Confusion can arise from media condemnation of Islamic extremism and, at the same time, praise for Islamic finance even if both claim allegiance to the same religion. Compounding this confusion is the academic narrative that treats finance as a purely secular subject that has little to do with the ethos and rules of a religion. The complex terminologies, which are mostly rooted in Islam's legal injunctions and historical practices, can render the field even more incomprehensible. This Very Short Introduction demystifies Islamic finance by shedding light on its core principles and practices. Adeel Malik and Usman Hayat cover the main debates surrounding Islamic finance's performance and potential, comparing and contrasting Islamic financial instruments with those of conventional finance, and building connections between Islamic finance and other ethical traditions in finance.

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Adeel Malik is Globe Fellow in the Economies of Muslim Societies at the Oxford Centre for Islamic Studies and serves on the faculty of Oxford University's Department of International Development. He is also a Fellow of St. Peter's College, Oxford. Malik specializes in political economy of the Islamic world, and his research on Middle Eastern political economy has featured in the CNN, Fortune Magazine, The Times London, Financial Times, Guardian and Gulf News.



Usman Hayat is executive director of the Securities and Exchange Commission of Pakistan, and oversees its Islamic Finance Unit. Until recently, he was a Director at the CFA Institute, the global association of investment professionals, where, for seven years, he worked as a content specialist in Islamic finance and environmental, social, and governance issues in investing. His co-authored works include Islamic Finance: Ethics, Concepts, Practice (CFA Institute, 2014) and Environmental, Social, and Governance Issues in Investing: A Guide for Investment Professionals (CFA Institute, 2015).

Acknowledgements
List of illustrations
1. What is Islamic finance?
2. Instruments of Islamic finance
3. Form versus substance
4. Political economy of Islamic finance
5. Islamic finance, social justice and development
Further reading
Index