Islamic Banking as a banking system that follows the ways of Islam Essay

Islamic Banking as a banking system that follows the ways of Islam - Essay Example As such, financial products are also designed according to such principles. Accumulating wealth is not against the law, but making money through unfair or fast means is not supported. Although Islamic banking is conservative in many ways, it is also safe. In Islamic banking, all transactions must be interest-free. There are several sets of rules for transactions, leasing, joint ventures, and partnerships. These laws are formulated with the Islamic religious sayings of the Quran and religious scholars in mind. In Islamic Banking, an Ijarah denotes the activity of leasing a property, is conducted by the bank. The bank takes possession of the property from its owner and leases it to a third party for rent; no interest is charged, as per the stated norms of Islamic banking. Even the maintenance cost is borne by the bank. The Islamic regulation is against making money through unfair means. For example, if the lessee pays a fine for late payment, the money goes to charity, not to the bank. Transactions in Islamic banking are considered Salam if the buyer pays the full amount to the seller. It is important that the buyer demonstrate that he is not in debt. Islamic banking offer many products that must be passed by the Shariah Supervisory Board. This board regulates and coordinates the operational activities of banking institutions functioning under Islamic banking rules (Hassan & Lewis, 2006, p. 1-4). Ijarah The term Ijarah refers to a lease, wage, or rent. It denotes the opportunity to use an asset or service at a predetermined price or wage. Under this type of contact, the bank makes the asset available to the customers by lending them for a fixed time period and at a fixed price or rent. Ijarah is derived from the word Al Ajr, which means compensation, substitutes, or counter value. It involves transferring the usufruct but not the ownership, of the asset. In Islamic banking, the bank and the customers are involved in the lending contract. The bank transfers the us ufruct to another person for a predefined period of time and consideration. Under Ijarah, the asset to be lent should be non-perishable and non-consumable. Any assets that do not follow the criteria cannot be treated as subjects for lending. Ijarah is used in two different kinds of situations: first, for providing services to other people in exchange for wages, and second, as hired services, where the employer is called 'musta jir' and the employee is called 'ajir'. The second situation deals with the lending of assets by banks to the third party in return for fixed rental charges from the party. Both types of Ijarah are formulated according to the laws of Islam. Ijarah is not only a mode of financing but also a medium for sales. This form of transaction is also followed in other, non-Islamic western countries (Ahmed, I. & Shabbir, n. d., p. 26). Ijarah wa Iktina In this type of lease, the leasor enters into an agreement with the lessee and agrees to buy the property after the compl etion of the leased period. The contract can be terminated even before the due date for the completion of the lease. The lessee can also buy the property before the date of commencement. The purchase price is determined by the market value of the asset. Ijarah Thumma Al-Bai This combines both the contracts that are Ijarah, meaning leasing and Bai, which means the purchase of the asset. Ij

Is Small Beautiful Critically appraise management styles in small Essay

Is Small Beautiful Critically appraise management styles in small firms - Essay Example In reality, approaches to business management may be based on entrepreneurial constituents. These will ultimately describe at a greater depth articulate the small business field management, something that is the center of focus in this piece of writing. Entrepreneurial style of management in small and medium-sized enterprises (SMEs) is anticipated is associated with success. This means that, through the styles of management, a small business firm would experience a high growth from one level to another. It is true to say that entrepreneurial management is associated with type of firm; that is, growth rate. The growth rate in itself may be either high or low as Eugene, Hampson, Ian and Beryl (2003) explain in their work. This work will for sure check on variability that exists in small business firms and the kinds and their managerial styles. Literature Small firms are numerous and operational in virtually all parts of the globe. They have a sense of global competence, and a thought a bout them introduces a deal of effectiveness in terms of management and style. It is better to understand the meaning and the relationship that the managers of the firms have with those that help them run their business. In the first place, it is imperative to understand the meaning of entrepreneurship. ... Following the small nature of firms, they become easy to manage in the hunt for their growth and profitability. This comes because of innovative ideas and behaviors that an entrepreneur allies with. Character traits of an entrepreneur who is success oriented clearly spring up. They cover all most aspects of growth-targeted areas that we need to see in the entrepreneurs. We will consider the character traits in a broad manner to see how successful small business owners should operate. To begin with, there is so much to do with personality traits. This makes an entrepreneur legible enough to discern what to do at the very appropriate moment. Personality traits in any small business owner cannot allow for an exceptional thing that may ruin the business. Attitude of any small business owner boosts the general outcome of the business. In fact, a positive attitude has all it takes to see success in the business. In this regard, it instills a better level of self- effectiveness, strength of a higher order and so on. In many cases, eagerness to change according to the current situations that face SMEs is a real stepping-stone to success. This is better off when still when a small business owner shows a great deal of interest in getting involved in creativity and innovation. A business becomes so beautiful to manage in the sense where there is competition aggression and that burning need for success and achievement. Consequently, these are what constitute the logic of small business being beautiful. In a small business enterprise, planning is considerably easier. Its management is swift since it offers a friendly environment for the owners and their customers at large. This does not