Banking and the global financial model is a topic that has been mainly addressed indirectly or directly by religions and think tanks with concepts that can be traced back to Adam Smith. Some have argued that we should walk-away from interest rates as its Riba, where Riba is forbidden in all three major religions. Others argued that we should move away from dealing with paper and go back to gold or silver, where until this day a common ground was not reached.
The purpose of this blog; however, is to directly contribute to building the basis of Ethical Lending. Ethical Lending is mainly concerned with the wider ramifications of bank actions and its impact on society. To be considered an ethical lender, financial institutions or banks should look at how business practices, processes, and products impacts society.
This blog is not to recommend that the world should go back to nativity, nor to get into controversial subjects such as which banking system is better and get into the "haram/halal," debate. I wouldn't also qualify it to be a scholarly blog. Instead, the blog aims to highlight some shortcomings in the current banking practices and provide solutions based on my personal experience and professional track record in banking.
Prior to going into the details of my topic; however, it is important to provide some advise and pose the following questions which I am sure many of you would consider it challenging to answer:
The purpose of this blog; however, is to directly contribute to building the basis of Ethical Lending. Ethical Lending is mainly concerned with the wider ramifications of bank actions and its impact on society. To be considered an ethical lender, financial institutions or banks should look at how business practices, processes, and products impacts society.
This blog is not to recommend that the world should go back to nativity, nor to get into controversial subjects such as which banking system is better and get into the "haram/halal," debate. I wouldn't also qualify it to be a scholarly blog. Instead, the blog aims to highlight some shortcomings in the current banking practices and provide solutions based on my personal experience and professional track record in banking.
Prior to going into the details of my topic; however, it is important to provide some advise and pose the following questions which I am sure many of you would consider it challenging to answer:
- How our banking and financial regulations being formed ?
- Who regulates the regulators ?
- What happens if we enter another crises ?
Advise 1: The answer to all of the above can be very vague and debatable. But what I would like to point out is that its all out of our hands as consumers or clients. Therefore, no one can protect us - except us.
- Should banks give loans for free or share losses with consumers ?
- Are bankers working for my best interest ?
- Are loans the answer to my needs ?
Advise 2: Know your needs as a consumer, educate yourself, and make a conscious decision or an educated decision on how to utilize a loan.
I would also like to add a disclaimer that the purpose of this blog is to evaluate issues and recommend solutions, and is not a blog aimed to insult, or humiliate financial institution, its employees, or even regulators.
I would also like to add a disclaimer that the purpose of this blog is to evaluate issues and recommend solutions, and is not a blog aimed to insult, or humiliate financial institution, its employees, or even regulators.
Lets now look at the current banking practices, and as "evil" it may seem, it is also important to consider why are the current practices harmful and what kind of actions both banks and regulators are doing to protect consumers.
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