“Islamic finance”, but what are we talking about?
Is it Shariah compliant financing, are they ‘halal’ financial products or ethical products at all? Called Islamic finance “halal” or “Shariah-compliant”, whatever name we give it, is to reconcile the world of finance with the real economy. Principles (proscribing speculation and any form of interest or usury, obligation tangible asset backing, etc …) establish a new equilibrium and argue for a moralized finance. Away from excess conventional finance and its adverse consequences suffered by individuals, it aims to liberate man from the debt based products and develop alternative funding models such as participatory Moudharaba and Musharaka.
Finally, it prohibits investment in certain sectors such as pornography, alcohol, tobacco, gambling, often severe addictions or sources of conflict or serious illness. These few introductory words highlight the objectives of Islamic finance which are full of common sense, or at least universal humanist. Undeniably, the unprecedented financial crisis that has shaken the globe has highlighted the genuine need for a new world of finance which is more responsible, ethical and equitable.
Islamic finance represents an alternative to the prohibited practices that led to this crisis, providing effective and innovative solutions are in place. It offers a new balance, and responds to a growing public demand for more ethical finance at the service of man.
However, the average citizen’s questions and concerns remain. Faut-il être musulman pour proposer des produits financiers basés sur ces critères dont nous venons de parler ? Faut-il être musulman pour y souscrire ? The answer to these questions is obviously negative. Clearly, Islamic finance fits into the broader context of ethical financial products. It is aimed at those who want a more responsible finance and integrate into their investment decisions a number of extra-financial criteria. Ainsi, ce sont probablement plusieurs millions d’individus quelque soit leur conviction qui pourront trouver une réponse à leurs attentes. Le seul dénominateur commun étant l’éthique, loin des considérations purement religieuses ou financières.