Bangladesh Bank Training Academy Journal

Abstract

The article unveils the circumstances which led to emerge Islamic banking and finally comments on its future. Basically Islamic banking is the outcome of the efforts to materialize the concept of 'banking without interest'. In today's global society, economic life is absurd without banking which is fundamentally based on interest. But interest is prohibited in Islamic life. This dilemma caused the emergence of Islamic banking as an alternative discipline. Initially Islamic banking drive was confined within mere designing of different interest-free modules as alternatives to corresponding conventional banking products. At least some of those modules are now seen producing better result than those of traditional banking in terms of resilience, justice and distribution of wealth. Recent growth trend of Islamic banking is also excellent. All these indicate a bright business future of Islamic banking. But business success is not enough. Eventually to fulfil Shariah objectives of Islamic economics as a whole, Islamic banking must do more including gradual enhancement of PLS or profit loss sharing based activities.