Shafeeq Rahman, a researcher in Islamic economic thought, said that Muslims have an unmet need for Shariah-compliant investments. “Whenever they receive any such venture they are attracted to it because they want to avoid traditional banking (that involves interest),” said Rahman. “These companies also offer higher rates of return, sometimes around 15-20% annually, compared to traditional banks. Even IMA (I Monetary Advisory – the company accused in the Bengaluru scam) gave such returns initially.”
The Sachar Committee report says that 20.5% of Muslim workers are in manufacturing, compared to 12.4% among Hindu upper castes. Because they are more likely to run their own businesses, Muslims have more need for credit and go to groups that offer halal financial services.
The problem is that these institutions use the claim of Shariah investments to lure depositors, but these groups are not regulated by government agencies. “This has not happened with Shariah funds in South Africa, UK and other non-Muslim countries. If the investments are not regulated by the government there will be an IMA,” says Rahman.
Published at Hindustan Times dated 23.06.2019
The Sachar Committee report says that 20.5% of Muslim workers are in manufacturing, compared to 12.4% among Hindu upper castes. Because they are more likely to run their own businesses, Muslims have more need for credit and go to groups that offer halal financial services.
The problem is that these institutions use the claim of Shariah investments to lure depositors, but these groups are not regulated by government agencies. “This has not happened with Shariah funds in South Africa, UK and other non-Muslim countries. If the investments are not regulated by the government there will be an IMA,” says Rahman.
Published at Hindustan Times dated 23.06.2019
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