Islamic Banking idea by RBI is a step backwards towards Sharia law

A country that claims to be secular should not participate in a banking system that emerges strictly in the name of religion. India has its own normal and consistent banking system, so establishing an alternative of this magnitude is alarming. It is with great horror to those who love freedom and democratic values that the Reserve Bank of India (RBI) has floated the idea of an “Islamic window” in banks to promote a “gradual introduction of Sharia-compliant or interest-free banking in the country”.

There is no shortage of examples that prove there only needs to be a small window of opportunity for Sharia law supporters to heavily influence and oppress regions. In this case, the window of opportunity is Islamic banking.

Islamic banking is not prevalent in Islamic-majority countries, even in Saudi Arabia. The establishment of this type of banking is not beneficial for the Indian economy and the inclusion of Muslims in India. Additionally, it does not invest in its community and help women have more opportunities to be financially stable.

- Advertisement - - Article resumes -

Islamic banking may seem like a great option for the Muslim community, but its deceptive practices can be detrimental bankers. Islamic banking is built on the premise that Sharia law prohibits charging interest. Therefore, Islamic banking claims to offer interest-free banking and functions on the principles of the Qur’an, particularly Sharia law. Muslims and those not able to use conventional banking may flock to this idea on these principles alone.

However, a bank must make profits in order to have money to lend people and sustain its practice. In order for the Islamic banking system to work, they must upsell items. For example, if a person needs a loan to purchase something, the Islamic bank will purchase that item and sell it to the customer for more money through other means. This loophole exists to earn a profit from customers while technically not charging interest on a loan or payment. Muhammad Saleem, former CEO of Park Avenue Bank in New York, wrote a book entitled Islamic Banking—A $300 Billion Deception, in which he emphasizes the notion that Sharia and Islamic banking charge interest under the guise of “Islamic garb”. He calls this practice dishonest.

Another major flaw of the banking system is the fact that they could deny or fund businesses as they please and based on how they interpret the Qur’an. This style of banking can lead to predatory-like tactics, such as denying women accounts for any reason or funding extremist activities. Denying women access to ways to save, invest, and support themselves continues to prevent them from accomplishing their own goals and improving their quality of life.

Those who are not Muslim are subject to unfair business and banking tactics, such as higher costs of sale transactions. By controlling how people spend and manage their money, Islamic banks have an opportunity of spreading its radical worldviews amongst others. While the Banking Regulation Act prohibits the establishment of a competing banking system, radical Islamists are known for changing laws once they have a foothold in a region.

The practices of Islamic banking does not guarantee economic or personal wealth accumulation. There was little attention drawn to the bankruptcy of the Canadian Islamic bank situation, but this particular circumstance points to a flawed method of banking. Consumers should look at this example as a foreshadowing of what could happen if this type of banking system becomes the preferred banking system.

Even though the face of banking is changing as new technology develops and the global economy stabilizes, studies (pdf link) show the economy thrives when there is open and free markets, namely conventional banking.

The solution is clear. People should be on guard against Islamic banking as a means to infiltrate an already established banking system in India. People should be on guard against Sharia law as a whole and not allow Sharia law to creep into the daily facet of their lives.

Sharia law has proven to be merciless toward women and Islamic banking would not be any different. Islamic banking would not propel women and the Islamic community forward, but would keep them behind our national and international counterparts.

Dr. Abedi is an Indian-American born in Mumbai, India to a Muslim family and raised in India & the United States. She currently wears multiple hats as a writer, a women’s rights activist, and a physician entrepreneur. She advocates for global public health, health laws and hopes for perfect humanism towards women one day. 

Share and Support:
Support OpIndia by paying for content

Most read articles recently

Here is why BJP lost elections, and of course, it was deliberate

What BJP supporters need to realise is this - no political party ever wants to lose and least of all, a party led by the two most politically aggressive politicians the country has ever seen.

India cannot turn into Islamic Nation, only Modi can understand gravity and do needful: Meghalaya HC

There should be uniform law for all Indian citizens, and anybody opposing the Indian laws and constitution cannot be considered as citizens of the country, Meghalaya High Court noted

BJP’s real woes: Lessons from the electoral semi-finals

The prolonged silence of Prime Minister Narendra Modi and BJP President Amit Shah on election results was very telling. The results were clearly unexpected and possibly led to prolonged internal discussions on the future course of action.
It is time for Congress and Gandhi Family mukt Bharat

Why Congress-mukt Bharat is still very much in progress

It is time BJP supporters understand the meaning of the term 'Congress-mukt Bharat'.

Can the BJP satisfy its online supporters? If only it were Congress

BJP supporters online, also known as the ‘right wing’, are first to attack the party and write it off after electoral setbacks.

BJP may be weaker than it was in 2014, but Congress is not as strong as projected either

If Congress has not forgotten the 1996 elections, they would very well know they are on a sticky wicket here.

Mayawati extends support to Congress for Madhya Pradesh, may consider Rajasthan ‘to keep BJP out of power’

She said to defeat BJP in Rajasthan, too, BSP will extend support to Congress.

Has PM Modi sounded the start of slog overs with the new RBI Governor’s appointment

Shaktikanta Das, who is currently a member of The Finance Commission and Former Finance Secretary (the one who presided over Demonetisation), has been appointed as the new RBI Governor by the Modi government

Demystifying Civil Society: Organization linked to ‘Urban Naxals’ wants schools to teach ‘Human Rights Education’

Federation for Human Rights (FPR) urged the government of Puducherry to introduce "Human Rights Curriculum" in the school curriculum in the Union Territory.

Madhya Pradesh: Twitterati showers praises at Shivraj Singh Chouhan as he gracefully concedes defeat

The BJP stalwart, Shivraj Singh Chouhan took the sole responsibility for the BJP’s defeat in the Madhya Pradesh Assembly elections.

Latest articles

Connect with us


Don't miss these