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Title: Examining the current practice of Ijarah in Islamic Financial Institutions in Sri Lanka
Authors: Hilmy, H. M. A.
Nathira Jahan, S.
Rija, J. F.
Keywords: Ijarah
Islamic Finance
Sri Lanka
Issue Date: 4-Apr-2021
Publisher: Faculty of Islamic Studies & Arabic Language, South Eastern University of Sri Lanka, University Park, Oluvil.
Citation: 8th International Symposium 2020 on “Promoting Faith-Based Social Cohesion Through Islamic and Arabic Studies”. 04th April 2021. South Eastern University of Sri Lanka, University Park, Oluvil, Sri Lanka. pp. 305-304.
Abstract: Most of the customer's concern that there are no differences between the Ijarah financing and leasing practice, both follow the same procedures. Therefore, the major objective of this study is to explore how Ijarah financing within the Sri Lankan context to remove the misconceptions mentioned above. For this purpose, a representative sample of two Islamic Financial Institutions were selected, namely LOLC AL-Falah and Amana Bank PLC, in a selected area of Akkaraipattu. The data were collected for this study, from both primary and secondary sources. The primary data were collected by conducting semi-structured interviews with the ‘ten’ practitioners, as well as ‘three’ Shari’ah experts of Sri Lanka are randomly selected. The secondary data were collected from records of selected IFIs, Magazines, Articles, Books, Websites, and recent news publications. The current practice of ijarah was compared with both selected IFIs based shari’ah Framework, for that purpose, content analysis method/documentary was used for analyzing the compared aspects of both. The researchers identified the fact that, while practicing ijarah financing in selected institutions there are few differences the only mismatch with shari’ah standard while most of the procedures are comply with shari’ah within 2 selected financial institutions. Also, this study tries to compare the system of leasing within conventional and Islamic financial institutions. The researchers can feel that both systems are completely different from each one in the ways of Interest +, Shari’ah compliance, and etc. Finally, the researchers point out that there are so many differences between Islamic and conventional side while practicing Ijarah where both they follow different procedures.
ISBN: 978-624-5736-14-0
Appears in Collections:8th International Symposium of FIA-2021

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