Islamic Finance in Finland

Perceptions of the Muslim Minority about Riba and Islamic Banking

Authors

  • Sanaa Kadi PhD student

DOI:

https://doi.org/10.13135/2421-2172/7162

Keywords:

riba;, Islamic banks, interest;, Islamic finance in Finland;, housing and Muslims in Finland

Abstract

Abstract— This is a research based on the results of a survey conducted with Muslims residing in Finland about the reasons for not taking usurious loans and their reluctance to pay interest, which affects significantly the Muslim community and leads to their financial exclusion, such as preventing them from owning a dwelling in Finland or investing their money in projects that are in compliance with their religion.

The results were exclusive and reflect the reality experienced by the Muslim minority in Finland. In addition to the interesting results observed, the non-existence of Islamic banking institutions in Finland makes this research unique because it explains how Muslims perceive usury and deal with it in an environment where the Muslim community is growing constantly but is still considered a minority.

References

Ahmad, S. M. (1981). Judaism and Interest. Islamic Studies, 20(1), 47–82. Retrieved from http://www.jstor.org/stable/20847156

Alharbi, A. (2015). Development of the Islamic Banking System. Journal of Islamic Banking and Finance, 3(1). https://doi.org/10.15640/jibf.v3n1a2

Ali, S. N., & AlQuradaghi, B. A. (2019). Publishing Islamic economics and finance research: polemics, perceptions and prospects. International Journal of Islamic and Middle Eastern Finance and Management, 12(3), 346–367.

Antoniazzi, S. (2022). Islamic Banks and the European Banking Union: An Overview of Critical Issues and Perspectives. European Journal of Islamic Finance, 9(1), 37–55. https://doi.org/10.13135/2421-2172/6424

Bälz, K. (2007). Islamic Finance for European Muslims: The Diversity Management of Shari’ah-Compliant Transactions. Chicago Journal of International Law, 7(2), 551. Retrieved from https://chicagounbound.uchicago.edu/cjil/vol7/iss2/11

Ben Mimoun, M. (2019). Islamic banking and real performances in a dual banking system: Evidence from Saudi Arabia. International Journal of Islamic and Middle Eastern Finance and Management, 12(3), 426–447. https://doi.org/10.1108/IMEFM-07-2018-0223

Biancone, P. Pietro, Hassan, M. K., Uluyol, B., & Paltrinieri, A. (2022). Social Impact Management and Finance and Islamic Finance for Sustainable Development. https://doi.org/10.13140/RG.2.2.27057.45925

Biancone, P. Pietro, Saiti, B., Petricean, D., & Chmet, F. (2020). The bibliometric analysis of Islamic banking and finance. Journal of Islamic Accounting and Business Research, 11(9), 2069–2086. https://doi.org/10.1108/JIABR-08-2020-0235

Bollani, L., & Chmet, F. (2020). Bibliometric Analysis of Islamic Finance. European Journal of Islamic Finance. https://doi.org/https://doi.org/10.13135/2421-2172/4936

Borchgrevink, K., & Birkvad, I. R. (2021). Religious norms and homeownership among Norwegian Muslim women. Journal of Ethnic and Migration Studies. https://doi.org/10.1080/1369183X.2021.1965866

Brekke, T., & Larsen, M. (2020). Allah, Villa, Volvo: Muslim Professionals in the Nordic Countries and Their Financial Attitudes and Practices. Open Library of Humanities, 6(2). https://doi.org/10.16995/olh.570

Brescia, V., Sa’ad, A. A., Hassan, R. B., Alhabshi, S. M. B. S. J., & Lanzalonga, F. (2021). Exploring sustainability from the Islamic finance perspective. European Journal of Islamic Finance, 19, 45–53. https://doi.org/10.13135/2421-2172/6107-Published

Buyukcelebi, I. (2005). Living in the Shade of Islam: A Comprehensive Reference of Theory and Practice. New Jersey: The Light.

Calandra, D., Marseglia, R., Vaccaro, V., & Chmet, F. (2022). Mapping Islamic finance and new technologies: research and managerial perspectives. European Journal of Islamic Finance, 9(1), 39–47. https://doi.org/10.13135/2421-2172/6257

Calder, R. (2016, August 1). God’s Technicians: Religious Jurists and the Usury Ban in Judaism, Christianity, and Islam. Archives Europeennes de Sociologie, Vol. 57, pp. 207–257. Cambridge University Press. https://doi.org/10.1017/S0003975616000096

Cebeci, I. (2012). Integrating the social maslaha into Islamic finance. Accounting Research Journal, 25(3), 166–184. https://doi.org/10.1108/10309611211290158

Chapra, M. U. (2001). Islamic Economic Thought and the New Global Economy. In Islamic Economic Studies (Vol. 9).

Chen, V., Welsh, M., & Cheong, M. F. (2022). Gender diversity on Malaysian corporate boards: a law and social movements perspective. Journal of Law and Society, 49(1), 23–47. https://doi.org/10.1111/jols.12341

Cortina, J. J., Ismail, S., & Schmukler, S. L. (2018). Firm financing and growth in the Arab region. Economic Systems, 42(2), 361–383. https://doi.org/10.1016/j.ecosys.2017.09.002

Daniel, I., & Jonathan, G. M. (2020). Islamic finance and social finance, an opportunity for social enterprises. European Journal of Islamic Finance. https://doi.org/https://doi.org/10.13135/2421-2172/4242

Davis, N. S. (2018). The Case for Regulatory Accommodation of Islamic Banking and Finance: Banking the Unbanked.

di Mauro, F., Caristi, P., Couderc, S., Di Maria, A., Ho, L., Kaur Grewal, B., … Zaher, S. (2013). Occasional Paper Series No 146 / June 2013 Islamic Finance in Europe. Retrieved from https://www.ecb.europa.eu/pub/pdf/scpops/ecbocp146.pdf

Ghaffour, A. R. (2017). Practical Aspects of Dispute Resolution in Islamic Finance Facilities “Past, present and future: Legal certainty and Islamic finance in Malaysia.” Kuala Lumpur.

Habermas, J. (1995). Struggles for Recognition in the Democratic Constitutional State. In Multiculturalism (pp. 107–148). Princeton University Press. https://doi.org/10.1515/9781400821402-008

Hackett, C., Connor, P., Stonawski, M., & Potančoková, M. (2017). Europe’s Growing Muslim Population.

Hasan, Z. (2021). Analysis of Factors Affecting Community Interest in Bengkalis Regency Riau Province Indonesia in Using Sharia Banking. European Journal of Islamic Finance, 19, 35–44. https://doi.org/DOI: https://doi.org/10.13135/2421-2172/6108

Huet, J.-M., & Cherqaoui, S. (2015). The rise and rise of Islamic finance.

Ibrahim, M. H., Salim, K., Abojeib, M., & Yeap, L. W. (2019). Structural changes, competition and bank stability in Malaysia’s dual banking system. Economic Systems, 43(1), 111–129. https://doi.org/10.1016/j.ecosys.2018.09.001

Iqbal, Z., & Mirakhor, A. (2011). An introduction to Islamic finance: theory and practice (2nd ed.). Singapore: John Wiley & Sons.

Itani, H., Sidani, Y. M., & Baalbaki, I. (2011). United Arab Emirates female entrepreneurs: motivations and frustrations. Equality, Diversity and Inclusion: An International Journal, 30(5), 409–424. https://doi.org/10.1108/02610151111150654

Jirvaj, H. (2022). Outlook 2022 UK Islamic finance-sector navigates COVID-19 and the post-Brexit era. Salaam Gateway. Retrieved from https://www.salaamgateway.com/story/outlook-2022-uk-islamic-finance-sector-navigates-covid-19-and-the-post-brexit-era

Kadi, S. (2022). Research Methods for Islamic Banking and Finance Law: Interdisciplinary Research Method. European Journal of Islamic Finance, 9(2), 1–8. https://doi.org/10.13135/2421-2172/6628

Kamdzhalov, M. (2022). Evaluation of some key features of Islamic finance in non-Islamic economies: Bulgarian perspective. European Journal of Islamic Finance, 9(2), 9–17. https://doi.org/10.13135/2421-2172/6504

Katterbauer, K., & Moschetta, P. (2022). A deep learning approach to risk management modeling for Islamic microfinance. European Journal of Islamic Finance, 9(2), 35–43. https://doi.org/10.13135/2421-2172/6202-Published

Kauppinen, T. M., & Vilkama, K. (2016). Entry to homeownership among immigrants: a decomposition of factors contributing to the gap with native-born residents. Housing Studies, 31(4), 463–488. https://doi.org/10.1080/02673037.2015.1094566

Kauppinen, T. M., Andersen, H. S., & Hedman, L. (2016). Determinants of Immigrants’ Entry to Homeownership in Three Nordic Capital City Regions. Swedish Society for Anthropology and Geography, 97(4), 343–362.

Kela. (2022). Housing benefits. Retrieved March 4, 2022, from https://www.kela.fi/web/en/housing-benefits

Khavarinezhad, S., Biancone, P., & Jafari-Sadeghi, V. (2021). Financing in the Islamic System and Sustainable Economic Development of Selected Islamic Countries. European Journal of Islamic Finance, 19, 1–6. https://doi.org/10.13135/2421-2172/6158

Lanzara, F. (2021). Islamic finance and Sustainable Development Goals. A bibliometric analysis from 2000 to 2021. European Journal of Islamic Finance, 18, 1–19. https://doi.org/10.13135/2421-2172/5765

Loke Ke Wei, K., & Mohd Thas Thaker, H. (2017). A qualitative inquiry into Islamic home financing: evidence from Malaysia. Qualitative Research in Financial Markets, 9(2), 147–167.

Mabrouk, A., Farah, L., & consultant -ProximaB Group, P.-S. (2021). Liquidity Risk Management in the Islamic Banking: Portfolio of Ijara and Murabaha. European Journal of Islamic Finance, 18. https://doi.org/10.13135/2421-2172/5848

Masood, O., & Bellalah, M. (2013). Development and Scope of Islamic Bank Bonds (Sukuk). In O. Masood & M. Bellalah (Eds.), Islamic Banking and Finance (pp. 126–158). Cambridge Scholars Publishing.

Maulidizen, A. (2018a). A Critical Analysis of Islam, Economy and Finance in the Early 21st Century. Hukum Islam, 17(2), 132–151. https://doi.org/http://dx.doi.org/10.24014/hi.v17i2.4984

Maulidizen, A. (2018b). Analisis Kritis Pembiayaan Murābaḥah di Keuangan Islam Modern Indonesia. Jurnal Ilmiah Ekonomi Islam, 4(2), 76–90. https://doi.org/http://dx.doi.org/10.29040/jiei.v4i02.189

Maulidizen, A. (2018c). Literature Study on Murābaḥah Financing in Islamic Banking in Indonesia. Economica: Jurnal Ekonomi Islam, 9(1), 25–49. https://doi.org/https://doi.org/10.21580/economica.2018.9.1.2411

Maulidizen, A. (2019). Business Ethics: Analysis of al-Ghazali’s Economic Thought With Sufism Approach. Religia, 160–177. https://doi.org/10.28918/religia.v22i2.2067

Maulidizen, A., & Nida, N. (2019). Pengaruh Pembiayaan Murabahah Terhadap Profitabilitas Bank Umum Syariah di Indonesia Periode 2010-2017. Jurnal Penelitian , 13(2), 215–250. https://doi.org/http://dx.doi.org/10.21043/jp.v13i2.6397

Mensah, J., & Williams, C. J. (2014). Cultural Dimensions of African Immigrant Housing in Toronto: A Qualitative Insight. Housing Studies, 29(3), 438–455. https://doi.org/10.1080/02673037.2014.848266

Mentz, M. (2012). Survey Research. In C. Wagner, B. Kawulich, & M. Garner (Eds.), Doing Social Research: A global context (pp. 100–113).

Meskovic, A., Kozarevic, E., & Avdukic, A. (2021). Social Performance of Islamic Banks ˗ Theoretical and Practical Insights. European Journal of Islamic Finance, 19, 1–17. https://doi.org/10.13135/2421-2172/6199

Mews, C. J., & Abraham, I. (2007). Usury and Just Compensation: Religious and Financial Ethics in Historical Perspective. Journal of Business Ethics, 72(1), 1–15. https://doi.org/10.1007/s10551-006-9151-0

Mohamad, A. A. S., Mohamad, M. T., & Hashim, S. A. (2018). Islamic versus conventional banking: Characteristics and stability analysis of the Malaysian banking sector. In New Developments in Islamic Economics: Examples from Southeast Asia (pp. 197–214). Emerald Group Publishing Ltd. https://doi.org/10.1108/978-1-78756-283-720181013

Mollah, S., & Zaman, M. (2015). Shari’ah supervision, corporate governance and performance: Conventional vs. Islamic banks. Journal of Banking and Finance, 58, 418–435. https://doi.org/10.1016/j.jbankfin.2015.04.030

Nazim Ali, S. (2010). Islamic Finance: Innovation and Authenticity. Retrieved from https://www.researchgate.net/publication/340594527

Nidyanti, A., & Siswantoro, D. (2022). The Sharia Compliance Level of Islamic Banks in Asia and Its Implications on Financial Performance and Market Share. European Journal of Islamic Finance, 9(1), 15–21. https://doi.org/10.13135/2421-2172/6025

Nor, M. Z. M. (2012). Cross-Country Analysis of Islamic Finance Dispute Resolution: Malaysia and Saudi Arabia. International Conference on Innovation, Management and Technology Research (ICIMTR2012):, 1–6. Malaysia.

Öblom, A., & Antfolk, J. (2017). Ethnic and gender discrimination in the private rental housing market in Finland: A field experiment. PLoS ONE, 12(8). https://doi.org/10.1371/journal.pone.0183344

Official Statistics Finland. (2022). Number of foreign-language speakers grew by over 25,000 persons. Retrieved from https://www.stat.fi/til/vaerak/2021/vaerak_2021_2022-03-31_tie_001_en.html

Otterbeck, J., Tuula Sakaranaho, & Hajjar, A. (2008, May 21). Muslim Immigrants in Finland. Retrieved October 31, 2022, from https://www.fiia.fi/en/event/muslim-immigrants-in-finland

Papa, C., & Rossi, N. (2022). Smart Cities and Sustainable Finance: The Islamic Perspective. European Journal of Islamic Finance, 9(2), 18–26. https://doi.org/10.13135/2421-2172/6167

Prandi, S., & Colecchia, D. (2021). Pricing of Islamic Banking and Conventional Banking: An Empirical Study. European Journal of Islamic Finance, 18. https://doi.org/10.13135/2421-2172/5465

Rancière, J. (2004). Who Is the Subject of the Rights of Man. South Atlantic Quarterly, 297–310.

Ray, N. D. (1995). Arab Islamic Banking and the Renewal of Islamic Law (Vol. 13). Arab and Islamic Laws Series.

Rusnanda, M. J. S., & Fathoni, M. A. (2022). The Impact of Macroeconomic and Fundamental Ratios Against Sharia Stock Returns at JII. European Journal of Islamic Finance, 9(2). https://doi.org/10.13135/2421-2172/6502

Salman, K. R. (2021). Islamic Governance, Maqashid Sharia Index, and Islamic Social Reporting: The Case of Islamic Banks in Indonesia. European Journal of Islamic Finance, 19. https://doi.org/10.13135/2421-2172/6158

Shome, A., Jabeen, F., & Rajaguru, R. (2018). What drives consumer choice of Islamic banking services in the United Arab Emirates? International Journal of Islamic and Middle Eastern Finance and Management, 11(1), 79–95. https://doi.org/10.1108/IMEFM-03-2017-0066

Siddiqi, M. N. (2004). Riba, Bank Interest and the Rationale behind its Prohibition. Jeddah. Retrieved from http://ieaoi.ir/files/site1/pages/ketab/english_book/205.pdf

Siddiqui, S., & Rizvi, Z. B. (2022). Understanding Volatility dependence between MENA Sukuk, GCC Sukuk and Nifty Shariah Index during Covid-19: A C-vine Copula Approach. European Journal of Islamic Finance, 9(1), 1–14. https://doi.org/10.13135/2421-2172/6067

Skovgaard, N. R., Holmqvist, E., Dhalmann, H., & Søholt, S. (2015). The Interaction of Local Context and Cultural Background: Somalis’ Perceived Possibilities in Nordic Capitals’ Housing Markets. Housing Studies, 30(3), 433–452. https://doi.org/10.1080/02673037.2014.973386

Topal, A. (2019). Economic reforms and women’s empowerment in Saudi Arabia. Women’s Studies International Forum, 76. https://doi.org/10.1016/j.wsif.2019.102253

Varga, J., & Bánkuti, G. (2021). Ranking methodology for Islamic banking sectors - Modification of the conventional CAMELS method. Banks and Bank Systems, 16(1), 36–51. https://doi.org/10.21511/BBS.16(1).2021.04

Yahaya, H., Suhaini Abdul Majid, M., Zuraina Mir Ahmad Talaat, A., Zaid Zulkifli, M., & Shaiza Mir Ahmad Talaat, N. (2016). Tabung Haji Malaysia as a World Role Model of Islamic Management Institutions. In International Journal of Business and Management Invention ISSN (Vol. 5). Online. Retrieved from Online website: www.ijbmi.org

Zucchelli, D. (2022). Recent trend of deposits in Islamic banks. European Journal of Islamic Finance, 9(1), 57–64. https://doi.org/10.13135/2421-2172/6260

Zulfikri, Sa’ad, A. A., Kassim, S., & Othman, A. H. A. (2022). Trust Enhancement in Zakat Institutions using Blockchain Technology: A Qualitative Approach. European Journal of Islamic Finance, 9(1), 31–36. https://doi.org/10.13135/2421-2172/6312

Downloads

Published

2023-04-19

How to Cite

Kadi, S. (2023). Islamic Finance in Finland: Perceptions of the Muslim Minority about Riba and Islamic Banking. European Journal of Islamic Finance, 10(1), 44–60. https://doi.org/10.13135/2421-2172/7162

Issue

Vol. 10 No. 1 (2023)

Section

Peer-reviewed Articles

License

Authors keep the copyrights for their work and give the journal the work's first publication copyright, which is at the same time licensed under a Creative Commons License – Attribution, which in turn allows other parties to share the work with an acknowledgement of the work's authorship and initial publication in this journal.

Similar Articles

1 2 3 4 5 6 7 8 9 10 > >> 

You may also start an advanced similarity search for this article.