HYDERABAD - Mufti Shaikh Sufyan, Shariah Scholar, Faysal Bank Hyderabad said the interest is a declaration of war against Allah and His Messenger. During a seminar on the Islamic banking system for traders, industrialists and entrepreneurs, held at the Secretariat of the Hyderabad Chamber of Small Traders and Small Industry (HCSTSI) here Sunday, he emphasised that in accordance with the decision of the Federal Shariat Court in Pakistan, all commercial banks were mandated to transition to the Islamic banking system by December 2027. He noted that the concept of banking found validation in the teachings of hadiths, and Pakistan’s banking sector was swiftly progressing towards Islamic banking principles. In line with this, the State Bank of Pakistan has received requests to convert 1,000 bank branches to the Islamic banking system within the current financial year. The Islamic banking system distinguishes between lawful and unlawful transactions, operating on a basis of profit and loss sharing. In instances where a businessperson incurs losses, it is imperative that the contractual obligations regarding the exchange of goods and services are fulfilled during the distribution of funds under various bank finance methods such as mudarabah, musharakah, murabaha, agreements. Specifically, through mudarabah and musharakah, both parties share in any incurred losses, he expressed. Sufiyan highlighted that Islamic banking established relationships with the tangible sectors of the economy through commercial endeavours.
In his welcome address, President Chamber Farooq Shaikhani emphasied that as Muslims, it was incumbent upon us to engage in interest-free trade, a principle upon which there was unanimous agreement while the Federal Shariah Court had set a deadline for the full implementation of the Islamic banking system, there appeared to be a lack of urgency in the efforts of the State Bank of Pakistan and all Islamic and commercial banks to execute this plan promptly.
He pointed out the requirement of comprehensive training for the staff of Islamic banks regarding the rules and regulations of the Islamic banking system. Oftentimes, bank personnel struggle to effectively explain the principles of Islamic banking to businessmen, industrialists, and the general public.
Assistant Chief Manager of the State Bank Hyderabad, Syed Ghulam Ali Shah, said that globally, there are 520 Islamic banks operating across 70 countries. He highlighted the significant progress made by the Council of Islamic Ideology in Pakistan, which commenced its operations in 1980 and has accelerated its efforts since 2000.
Muhammad Izhar, Acting Chief Manager of the State Bank of Hyderabad expressed the bank’s commitment to providing a comprehensive Islamic banking system for the future generations of Pakistan. To achieve this mission, seminars are being organised in collaboration not only with business institutions but also with government support, he expressed.
During the event, Senior Vice President Dr Muhammad Ismail Farouk Nami, alongwith Shan Sehgal, Waseem Ahmed Qureshi, Kashif Shaikh, Shahid Qaim Khani, Parvez Faheem Noorwala and others, posed inquiries regarding Islamic banking. Vice President Muhammad Yaseen Khilji, Former Presidents Doulat Ram Lohana, Muhammad Akram Ansari, members of the executive committee, conveners of sub-committee and members from the general body were also in attendance.
