Islamic Banking Law and Its Application in Islamic Banks for the Economic Development of Bangladesh

Professor Dr. ABM Rashedul Hassan, Dr. Mostofa Mahmud Hasan, S M Shahidul Islam

Abstract:

Financial institutions are one of the essential parts of the circular flow of the economic model. They also contribute to leakage through household and business savings. As a financial institution, a bank contributes to the economic development of any country. Islamic banks, newly introduced and becoming popular in a short time, have contributed a great deal to the economic growth and overall development of Bangladesh. Bangladesh has experienced phenomenal growth in Islamic banking as a result of strong public demand for the system, in tandem with the global rapid expansion of Islamic banking. Islamic banking is a part of the banking system in most Muslim countries and some non-Muslim countries as well, and Bangladesh is one of them. For the last few decades, Islamic banks have demonstrated their strength in accomplishing the purpose of Islamic Shariah. As a result of the success, many regular banks have been convinced to open Islamic branches in addition to their conventional equivalents. This paper is based on secondary data and a review of the literature. The goal of this study is to generate a positive performance report that focuses on the growth and development of Islamic banking and the application of Islamic banking regulations in Bangladesh, as well as to explain what development really means from an Islamic perspective. Moreover, identifying the Islamic banking sector for its smooth running with a view to enhancing the economic development of the country is one of the significant purposes of the study.

Keywords:

Islamic Banking, Conventional Banking, Economic Development, Interest Free, Profit Loss Sharing.

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