Introducing Islamic Finance in Unchartered Economies: The Case of Canada

Baharom Abdul Hamid, Mohsin Ali, Wajahat Azmi and Zaheer Anwer ()
Additional contact information
Mohsin Ali: INCEIF
Wajahat Azmi: INCEIF

A chapter in Developments in Islamic Finance, 2017, pp 121-145 from Palgrave Macmillan

Abstract: Abstract The primary goal of this paper is to explore the viability of initiating Islamic finance (IF) in an unchartered economy. CanadaCanada is taken as a case study for this paper. To achieve our objective, we proceed in two stages. The first stage involves the analysis of market opportunities for IF. More precisely, the first stage involves the cost/benefit analysis which would enable the IF industry to see whether it is feasible for them to initiate. Second, the more challenging stage involves the analysis with regard to the barriers in offering IF products. In other words, we examine whether some of the IF products can be offered in the current regulatory framework. More importantly, we also examined the current banking regulations, which might hinder the offering of IF products, and provide suggestions on the amendments that can be made to ensure the smooth start. Broadly speaking, in this paper, we dispel certain myths surrounding the system such as it is not compatible with the contemporary finance and Muslims exclusivity etc. Based on the demography, established ethical market, existence of Islamic indices and the mutual funds, and its high rank in the Islamicity index, we argue that CanadaCanada could be one of the avenues to initiate Islamic financial system. We have also highlighted some of the economic benefits of such system in terms of its impact on economic growth. Additionally, we have also elaborated on how its risk-sharing characteristic and attachment to real economy could be beneficial for Canadian economy in terms of lowering the risk of banking crises and stock market crashes.

Keywords: Islamic finance; Unchartered economy; Developed countries (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations: View citations in EconPapers (1)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:pcichp:978-3-319-59342-5_6

Ordering information: This item can be ordered from
http://www.palgrave.com/9783319593425

DOI: 10.1007/978-3-319-59342-5_6

Access Statistics for this chapter

More chapters in Palgrave CIBFR Studies in Islamic Finance from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().