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Interest-free banking system
November 20 , 2022
739 days
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- The Pakistan Government is planning to implement an interest-free banking system in the country from 2027 under the Islamic law.
- The concept of interest free banking system is derived from the Islamic form of banking.
- It operates based on ethical standards and prevents Muslims from paying or receiving any kind of interest.
- It is considered to be an effective tool to achieve the economic objectives of Islam.
- The first petition to abolish the existing interest-based banking system in Pakistan was filed in 1990.
- The Federal Shariat Court directed the government authorities to implement the system by June 30, 2000.
- After many appeals, It called on the government to eliminate Riba - the Islamic term for interest – from the country’s banking system by December 31, 2027.
- Meezah Baank, Pakistan’s first completely Islamic bank was established in the early 2000s.
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