The social basis on which the Islamic banks depend

The social basis on which the Islamic banks depend

The Islamic banks are considered social banks that achieve social solidarity through collecting Zakah and spending it in its Shari`ah channels, investing the extra funds of Zakah, and distributing its revenues to those who deserve them.

The difference between Islamic banks and their traditional counterparts is in the system of work, whereas the traditional banks aims at achieving profits mainly and do not aim to achieve any other objective.

As for the Islamic banks, they aim to develop the society financially, but in the meantime do not overlook profit, however it comes in the second rank. [1]

Therefore, Islamic banks are working to reinforce and activate this side through its active role in achieving social solidarity based on the boxes of Zakah, non-usurious loans, and contribution in solving the varied social problems.

Moreover, Islamic banks are working in its social philosophy on the following:

• Elimination of monopoly in all its kinds and supporting merchants.

• Establishing the regulations of justice and equality in profits and losses, and generalization of benefit among large number of Muslims after the interests have become for the business owners who do not care for the source of their money.

• Reviving the system of Zakah by managing special boxes for collecting Zakah. Funds of Zakah in Islamic banks play a vital economic role that manifests in distributing wealth and job for investing extra money.

• The principle is: funds do not grow except by investing them and that investment shall be subject to risks; accordingly, the result of investment may be profit or loss.

• Directing savings to the fields which serve economic and social development.

Based on these characteristics and spectacular philosophy of Islamic banks, Islamic banks spread and included most Arab and foreign countries. That had a set of positive results, which we wish to be managed in a proper limit.

Of the most prominent of these results are the following:

• High quality for managing financial crises because of sharing profit and loss.

• Widespread of the boxes of Zakah and non-usurious loans in Islamic banks.

• Development of banking tools and products in a great dynamic provided that to cope with the requirements of reality.

• Well-Management of risks based on the basis of sharing risks.