FINC1301 CHAPTER 2 BASIC PROHIBITIONS AND ETHICS IN ISLAMIC FINANCE

Riba

Usury or interest, which involves excessive gains derived from loans or financial transactions.

Gharar

Uncertainty or ambiguity in a contract that can lead to exploitation or injustice.

Maysir

Gambling or games of chance that involve acquiring wealth without effort or work.

Amanah

Trust or responsibility in financial dealings within Islamic finance.

Usury

The practice of charging excessive interest on loans, prohibited in Islam.

Iqra'

The Arabic word meaning 'read', serving as a foundation for seeking knowledge in Islam.

Ethics in Islamic Finance

Moral principles and guidelines governing financial activities in accordance with Islamic law.

Shariah

The Islamic law derived from the Quran and Hadith, regulating various aspects of life including finance.

Justice and Fair Dealings

The principle that requires fair treatment and honesty in all financial transactions.

Importance of Transparency

Essential to ensuring that all parties in a contract are fully informed about the terms and conditions.