Which Islamic banks are truly Islamic? - Assim al hakeem
Summary
TLDRThe speaker addresses a question about the legitimacy of Islamic banks. He explains that while some Islamic banks have a robust Sharia board that rigorously oversees transactions to ensure compliance with Islamic principles, many others only have nominal boards that provide minimal oversight. These latter banks may not fully adhere to Islamic guidelines, making their practices questionable. The speaker advises caution and suggests consulting knowledgeable scholars to verify a bank's authenticity.
Takeaways
- π€ Many laypeople are unsure about which Islamic banks are genuinely following Islamic principles.
- π¦ Islamic banks can be categorized based on how strictly they adhere to Sharia guidelines.
- π To verify an Islamic bank's authenticity, one should consult local scholars and review the bank's Sharia board.
- β Some Islamic banks have a Sharia board that rigorously oversees every transaction with regular spot checks.
- π These banks ensure compliance by frequently auditing branches and correcting any un-Islamic practices.
- β However, there are Islamic banks with honorary Sharia boards that rarely meet and may not enforce compliance.
- πΌ These honorary boards might only review select projects occasionally, without ensuring proper implementation.
- β οΈ The majority of Islamic banks fall into the latter category, where compliance with Sharia is dubious.
- βοΈ Scholars on these honorary boards may approve projects but are not involved in ensuring daily adherence to their rulings.
- π Due to the lack of rigorous oversight, it's advisable to be cautious and avoid dealing with such banks.
Q & A
Question 1
-What is the main concern raised by Sister Amina in the transcript?
Answer 1
-Sister Amina is concerned about how to determine whether Islamic banks are truly following Islamic principles and whether it is permissible to take profit from them.
Question 2
-How does the speaker respond to Sister Aminaβs question about Islamic banks?
Answer 2
-The speaker acknowledges the complexity of the issue and mentions that laypeople may not have the knowledge to assess whether Islamic banks are truly Islamic. He suggests consulting scholars and checking the Sharia board of the bank.
Question 3
-What are the two types of Islamic banks mentioned in the transcript?
Answer 3
-The speaker describes two types of Islamic banks: (1) those with a genuine Sharia board that governs all transactions and conducts regular audits, and (2) those with an honorary Sharia board that meets infrequently and may not audit daily transactions.
Question 4
-What does the speaker say about the Sharia boards of some Islamic banks?
Answer 4
-The speaker states that some Sharia boards are honorary and only review a few projects occasionally, without ensuring that their advice is implemented in day-to-day transactions.
Question 5
-How does the speaker describe the role of a Sharia board in auditing Islamic banks?
Answer 5
-The speaker explains that a proper Sharia board should conduct regular audits and spot checks of transactions to ensure compliance with Islamic principles, rather than just providing occasional approvals.
Question 6
-Why does the speaker express doubt about certain Islamic banks?
Answer 6
-The speaker is doubtful of Islamic banks that do not have proper audits or governance by the Sharia board, as it raises concerns about whether they are truly following Islamic principles.
Question 7
-What does the speaker mean by saying that some Sharia boards are 'dubious'?
Answer 7
-The speaker implies that certain Sharia boards are not trustworthy because they do not actively ensure that their fatwas and Islamic guidelines are implemented in practice by the bank.
Question 8
-What does the speaker suggest individuals do to verify the legitimacy of an Islamic bank?
Answer 8
-The speaker suggests that individuals should consult scholars in their country and look into the governance and auditing practices of the bank's Sharia board.
Question 9
-According to the speaker, how often should a proper Sharia board audit an Islamic bank's transactions?
Answer 9
-A proper Sharia board should conduct audits every few weeks, spot-checking branches and reviewing transactions to ensure compliance with Islamic rules.
Question 10
-What is the speakerβs concluding advice regarding Islamic banks?
Answer 10
-The speaker advises caution, recommending that people avoid dealing with Islamic banks that do not have a reliable Sharia board overseeing and auditing their operations.
Outlines
π€ Understanding Islamic Banks and Their Compliance
Sister Amina asks about identifying truly Islamic banks and whether it's permissible to take profits from them. The speaker acknowledges the complexity of the issue, referencing a previous video discussing the authenticity of Islamic banks. The speaker explains that as a layperson, it's difficult to assess the Islamic integrity of a bank without extensive knowledge of their processes. The best way to verify this is by consulting scholars in the country and examining the bank's Sharia board.
π Types of Sharia Boards in Islamic Banks
Islamic banks are categorized into two types based on their Sharia boards. The first type has an active Sharia board that thoroughly monitors every transaction, conducting spot checks throughout the year to ensure compliance with Islamic principles. The second type has a more passive Sharia board that meets infrequently, reviews a few projects, and gives approval without conducting audits to ensure that their advice is being implemented. This passive type is more common among Islamic banks.
πΌ The Role and Accountability of Sharia Boards
The speaker explains that many Islamic banks only have honorary Sharia boards, which give rulings without following up to ensure compliance. The speaker criticizes such practices, as the Sharia board members, including himself, may simply sign off on decisions without verifying their implementation. This lack of oversight makes these banks dubious, and the speaker advises caution when dealing with them, leaving the decision to Allahβs knowledge.
Mindmap
Keywords
π‘Islamic Bank
π‘Sharia Board
π‘Profit
π‘Compliance
π‘Spot Checks
π‘Fatwa
π‘Dubious
π‘Honorary Sharia Board
π‘Layman
π‘Audit
Highlights
Sister Amina asks about identifying truly Islamic banks.
The speaker acknowledges the complexity of determining if a bank is genuinely Islamic.
There is a famous video clip by the speaker questioning if Islamic banks are truly Islamic or just using the label.
The speaker does not have the expertise to personally verify if a bank operates according to Islamic principles.
Verification should be done by consulting scholars in the country and checking the bank's Sharia board.
Islamic banks are categorized into two types: those with active Sharia boards and those with honorary ones.
Banks with a real Sharia board have regular spot checks to ensure compliance with Islamic principles.
Spot checks by the Sharia board involve reviewing transactions and correcting non-compliant practices.
Some banks have a Sharia board that meets infrequently and only reviews a few projects.
The implementation of the Sharia board's advice may not be monitored or enforced in some banks.
The speaker notes that most Islamic banks fall into the latter category with less stringent oversight.
The speaker describes their role as simply signing off on fatwas without ensuring their implementation.
There is concern that many Islamic banks are dubious in their operations.
The speaker advises caution in dealing with such banks.
The speaker concludes that Allah knows best regarding the true nature of these banks.
Transcripts
the next question is from sister amina
uh as a layman i do not know which
islamic banks are truly islamic
if it's a well-known islamic bank can we
take its profit
wow this is a complicated issue because
there is a famous video clip of mine
which talks about islamic banks are they
real or just a tag name
and in a nutshell
if a bank comes to me and says i'm an
islamic bank
i don't have the knowledge to go into
the processes
and to see how they act and deal on
day-to-day basis
so the only way to do uh to verify this
is to ask the people in the country
the the scholars of the country and
to check their sharia board islamic
banks
are divided into two types one that has
a real sharia board
that governs every single transaction
that has spot checks throughout the year
every
few weeks they go and spot check a
branch and
look into their transactions why did you
do this didn't we say
that this is haram you should not sell
except what you possess etc
other islamic banks have a sharia board
but they are in a way
an honorary sharia board meaning that
they just
convene or meet once every
uh
few months like six months or four
months
a year and they show them few projects
and they look into it and they say yes
or no but whether these
projects are implemented as per the
advice
of the sri aboard or not this is not
their business so there's no
audit that looks into them
to make sure whether
it's being islamically true
or not and the vast majority of islamic
banks are like
the latter so the sharia board like
myself
i just sign and i go
whether my fatwa is being implemented or
not i don't care
i'm being paid at the end of the month
or the year and
who makes sure that this is implemented
or not
on day-to-day basis nobody such
banks are dubious you should not be with
and allah knows best
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