IS ISLAMIC BANKING REALLY ISLAMIC IN PAKISTAN? "STUDY FOCUSING ON TWO ISLAMIC BANKS IN PAKISTAN"

Abstract

Islamic Banking, the Shariah (Islamic law) compliant banking for Muslims, is unarguably at the promising stage of its development as a financial competitor and alternative to the conventional interest - based banking system practiced around the world. This thesis looks into the principles of Islamic banks of Pakistan and focusing two Islamic Banks in Pakistan. The thesis analyzes the findings of two banks made by interviews, to check that are the principles different or same. This thesis is qualitative in nature, based on theoretical and empirical findings. RESEARCH QUESTION How two Islamic Banks are following the principle of Islamic Banking? PURPOSE The aim of my study is to describe and analyze how two Islamic banks in Pakistan are following the ideology/ Principles of Islamic banking. METHOD My research is based on qualitative research method and the data collection done from primary and secondary sources by the meetings/interviews from executives of Islamic banks of Pakistan. CONCLUSION It was founded that Islamic Banks in Pakistan are not following the principles completely, there are some principles which are followed successfully, principle that there must be some risk and based on Profit and loss sharing (PLS) but some principles are not followed (loss is divided according to the capital investment from both which are interviewed, lender should solely bear the risk). Although the principles of Islamic banks in Pakistan are similar but are modified as observed from the interviews.