Halal Finance
Halal Finance refers to financial practices that comply with Islamic law, or Sharia. It prohibits activities involving interest (riba), excessive uncertainty (gharar), and investments in businesses that deal with alcohol, gambling, or pork. Instead, it promotes ethical investing and profit-sharing arrangements, ensuring that financial transactions are fair and transparent.
In Halal Finance, common instruments include Murabaha (cost-plus financing), Mudarabah (profit-sharing), and Ijara (leasing). These methods allow individuals and businesses to engage in financial activities while adhering to their religious beliefs. The goal is to create a financial system that is both ethical and socially responsible.