Islamic banking represents an attempt to organise contemporary trade according to principals of Islamic law Sharia, by which collecting interest on lent money is strictly forbidden. Sunnite moral codes as well as Islamic holy scripts as Koran, directly forbid every procedure which leads to rise of capital without doing any exchange of goods or services. In most Islamic communities, collecting interest (Riba) is a heavier felony than consuming pork, alcohol or committing adultery. It is considered that the basic existence of such a strict sanction is in fact the need to stop the exploitation of poor social classes. Rich must help less successful. Therefore, Islamic banking represents the answer of Muslim economists and theoreticians, to business challenges which did not exist in time of Muhammad. Although principal roots of Islamic banking can be found in “The Islamic Golden Age” (from 700 AD. to 1200 AD.), it is considered that it has managed to find its modern appearance in the second half of the 20th century, when the first modern commercial Islamic bank was opened in Dubai in 1975.
The expansion rate of Islamic banking is estimated to 10-15% a year, and the global system of these banks counts over 300 institutions in 51 countries today, together with 250 shared funds which are managed by Islamic principals of trade. The fact that Islamic banks have overcome the current economic recession very easily have initiated a general interest for this kind of financial trade.
