Islamic finance and banking are based on principles that are in line with Islamic law (Sharia). The RQF Level 5 Certificate Concepts of Islamic Finance and Banking online course covers the following key principles:
| Principle | Description |
|---|---|
| Prohibition of Interest (Riba) | Islamic finance prohibits the charging or paying of interest, as it is considered exploitative and unjust. |
| Risk-Sharing | Parties share profits and losses in financial transactions, promoting fairness and discouraging excessive risk-taking. |
| Asset-Backed Financing | Islamic finance requires transactions to be backed by tangible assets, promoting transparency and reducing speculation. |
| Ethical Investments | Islamic finance encourages investments in ethical and socially responsible projects, avoiding industries such as gambling and alcohol. |
By understanding and applying these key principles, individuals and institutions can engage in financial activities that are not only compliant with Islamic law but also promote ethical and sustainable practices in the financial sector.
For more in-depth knowledge and practical application of these principles, consider enrolling in the RQF Level 5 Certificate Concepts of Islamic Finance and Banking online course.