Friday, February 3, 2017

Insurable Interest?

Friday, February 3, 2017 0
Insurable Interest?

Monday, January 11, 2016

Financial Crisis Among Malaysian Students? Criticism is not a Solution, but finding a Way out is an effective Solution

Monday, January 11, 2016 0

There are numerous reports published in recent days in social medias and news broke in different levels of public environments with an undesirable fact and phenomena (,, that, a big number of Malaysian students at the higher learning institutions are unable to secure financial support from MARA, PTPTN, JPA and or others public or private sponsors to support their education expenses and daily necessities even basic foods. Because they do not have any financial support from any organization either as a loan, scholarship or even aids.  

Among those students, a small number is from wealthy families who might have been supported by the families, another group is from average families who might have been supported by families with very basic contributions by having somehow hardship experience.  While the 3rd group is the big number who are from below the average and or low income families who are even struggling to support their own families in daily needs, but can one soundly been imagined to support the kids' education at the tertiary levels? 

Looking at this humanitarian phenomena, some people keep on with endless criticism, attacks and worse predictions without giving right and effective solution to the way out. Meaningless criticism with no alternatives does neither bring any solution nor ease the crisis rather worsening the situation with an unrepaired end.
Thus, following steps are recommended here in view of an effective way out of the crisis, which shall be achieved based on the holistic spirit of mutual cooperation, care and concern thus, shall effectively be ruled out with result oriented execution by the respective authorities of the government.

Establishment & Management:
A special Tabung, fund or account shall be established to manage a special education fund may be named: " Needy Students' Fund (NSF)", which shall be managed by a GLC under the PM's Department or MOE or Ministry of Religious Affairs. 

Sources of the Fund: 

                It is neither fair nor wise to shift every responsibility on the shoulder of the government. The citizen in general must cooperate and contribute with wise ideas and possible supports towards creating a dynamic nation. Thus, to achieve the goal of true dynamism in the country, both the government and the citizen must support each other within the spirit of cooperation for the common good. Endless criticism and attacks with no solution on the other hand do not ensure any significant result rather develop uncertainties in ruining the true objective. However, the following sources of funds are suggested just considering the fact of a national contribution towards creating a secured futures for the needy students and their respective families through mutual contribution, cooperation and generosity in helping hands.
·       Part of the Zakat fund may be taken out by justifying on the fact that, needy students fall within the meaning of Asnaf al-Zakat (recipients of Zakat) as to Fuqara' (needy) Masakeen (poor) and also Fi-Sabilillah (in the way of Allah swt and or Seeking Knowledge).

·       Structuring and duly Launching Sukuk al-Waqf (charitable bonds) for needy students, which may be structured on the basis of al-Tabarru' (donation) and to be manage on the basis of the principles of al-Waqf. It shall be launched by inviting public (Shari'ah recognized) at large   to subscribe with a minimum premium (per value) in view of helping the needy students with no commercial return

·       Structuring and launching an alternative to GST just for helping the needy students of the country, may be named: NSF-GSD (Goods, Services Donation) with an extra charge by 2% in each transaction.

·       A generous contribution with 10% monthly salary of every employee whose earning is RM 1, 500.00 and above monthly, which may be continued for a period of one year only.

·       10% of the tax / Zakat / Fitrah / compounds / summons from all levels may be contributed to the NSF for a period of 6-12 months only.

·       Reducing of all business / executive trip packages (cost) from all employees in the public and semi-public sectors to economy class / standard for period of one year only and the proceeds (gap) shall be payable to the NSF.

 ·       Cutting off 25% of the entertainment allowances may be exercised for a period of one year only from all employees in public and semi-public sectors, and the proceeds shall be contributed to the NSF.

·       A Week fund raising Campaign may be organized nationwide in creating a special fund to help needy students of Malaysia.

Additional Alternatives:

·        To encourage students in group to establish and operate cash-base in-campus entrepreneurship (small business). The institution or any bank may provide a minimum required financing (soft-loan) to those students enabling the operation of such entrepreneurship in view of supporting their education and daily needs.
·       The institution may create Part-time job opportunities in campus or off-campus for the needy students with a limitation so that the education is not effected.
Long-term Plan:
·       It shall be a mandatory rulings that, every guardian shall (as per ability) subscribe a tertiary education insurance / Takaful within 7 days of the birth of the child. Such policy is important to ensure that, the future generation are not left behind the tertiary education just because of no financial support.

              It is thus, submitted that, the above concern, thoughts and suggestions are recommended to be tabled at the policy making levels and be strategized further in view of a sustainable solution for the future back-bone of the country and duly execute them as per the standard policies for the national benefit.

Tuesday, June 16, 2015

Cooperative Micro-financing through "Ushr Management" ?

Tuesday, June 16, 2015 0

 An effective "Ushr management" may be a potential base in developing a model of "Cooperative micro-financing (CMF)" as an able alternative to the contemporary micro-credit system, to create an entrepreneurship based society by fighting the povertiness across the world of socio-economic environment.

The CMF model shall not merely be commercial oriented one, but with holistic approach integrated with socio-economic and humanitarian value for all.

(for a detail a recent presentation by Mr Muhammad Obaidullah on 'Ushr Management may be referred through):

Sunday, February 1, 2015

A serious confusion is created by the minister of finance (BD) over Islamic banking system. "Please Stop it" - a gentle reminder !

Sunday, February 1, 2015 0
H.E. Mr Abul Mal Abdul Muheet, the minister of finance of Bangladesh (BD) has recently claimed in the Parliament on February 01, 2015 (Sunday) that, Islamic banking is a FRAUD, 'Riba' & today's 'Interest' are not same and practices of interest is on humanitarian ground.(Ref: 

It's neither justifiable nor acceptable if a minister with such an important authority claims or rules out some thing, which is in fact without knowledge, awareness, justification or understanding. Such act can simply be levelled as "irresponsibility" over own self, community, nation and world of humanity at large. Such irresponsibility may easily create a serious confusion in public with huge damage.

Islamic banking is not simply a traditional or religious issue, but it's a Divine integrated just system for all humanity with sustainable benefit & eco-protection as had been greatly appreciated, accepted & benefited not only by Muslim but also equally by non-Muslim across the world of the contemporary economic reality. (a paper from the World bank is linked here just for an idea:…/Islamic%20vs.%20Conventional%20B…).

Thus, it's a gentle reminder to all levels of authorities including H.E. the minister to kindly "READ, UNDERSTAND, STRATEGIZE & VISUALIZE" before any issue to be expressed or ruled out for the public interest, so to help every one from being confused carelessly & suffered for nor reason.

Tuesday, May 6, 2014

Evolution of Islamic Finance in the Modern eco-Environment

Tuesday, May 6, 2014 0
Today, the market segment of Islamic financial products and regulations are no longer confined within a limited territory, but are in the borderless world of the Web, having exposure to almost all groups of people worldwide. The market mechanisms adopted by the potential marketers include dynamic strategies and mechanisms of governance to match the applied global phenomena, where both Muslim and non-Muslim are equally participating to market Islamic financial products with promising results.

 The promising arena of Islamic corporate application and governance has caught the attention of both Muslims and non-Muslims, with equal participation in establishing and offering competitive and sound Islamic financial products. Resulting from this phenomenon, besides having almost 300 entities of full fledged Islamic financial providers in today’s world, almost all conventional potential players are also offering Islamic financial products through the establishment of segregated windows and divisions respectively, by adapting suitable mechanisms of Shari’ah compliance.

 Numerous options of Shari’ah justified instruments are in fact being applied by product specialists and technical experts in Islamic financial industries, who are developing competitive Islamic financial products with innovative cultural and dynamic corporate outcomes. As a result, these products for investors, customers and bankers are paving the way for Islamic financial industries. The products are designed not only to satisfy retail groups, but also corporate levels. If such dynamic product innovation continues, the growth rate of Islamic financial business, considering the historical rate, may reach to 40 to 50 percent by the year 2020.

But such an achievement certainly and rationally requires rediscovery of mechanisms for product innovation, culture of products review, review of professionalism, and improving the relevant policies, regulations and governing standard with ethical guidelines, as these shall not be denied in any sector of the Islamic industrial movement.

Strategic planning for every move of Islamic financial industry is of utmost importance to ensure smooth and successful growth of the industry. Strategic planning should be consolidated with dynamic actions. For this exercise, it is essential to ensure the presence of experts in: Shari’ah, decision-making, technical, operational or /and marketing avenues, along with proper professionalism and rightful performance justified by Shari’ah standard.

Resurgence of Islamic Finance in the Modern Reality

The modern growth of the Islamic financial industry began in Egypt and the Arab world, while Malaysia caught the wave in the early 80s and subsequently, we have seen a rapid gradual development through both the Muslim and non-Muslim world. Due to the present phenomena of development and dynamic offerings of applied Islamic financial products, Malaysia, Bahrain and UAE play the top-ranking roles in the global Islamic financial market.

 Applied Islamic financial sectors have developed into a global dimension, which is highly dynamic and growing rapidly with utmost appreciated by not only among 1.8 billion of Muslim, but also by non-Muslim across the today’s world, which leads the Halal industries and Islamic financial market to stand as an able alternative to the conventional ones with sustainable existence for all.

 The global Halal industries, Islamic financial market and Shari’ah compliant industries, activities and markets reach to a value of trillions in dollar.  There are almost 400 Islamic financial institutions worldwide. According to the Global Islamic Finance Report -2013 (GIFR) the global Islamic Finance Market value indicated at US$ 1.631 trillions, with its growth rate estimated to be around 20.4 %  p.a.

 Among the master players of Islamic finance in the contemporary world are the Middle East, Malaysia, Iran, Indonesia, Brunei, Singapore, North America, Pakistan, Bangladesh, South-West Africa and the U.K. The cliental of Islamic financial institutions are not confined to Muslim countries but are spread over Europe, the U.S.A, South Asia, South East Asia, Asia Pacific and the Far East. Providers are not confined to local institutions as global players increasingly playing major roles in the industry today by aiming the global appreciation from all regardless of the issue of one’s religion, color, culture or status.

Apart from the existing world players, the next wave of industrial growth can be predicted from the non-Muslim world with a reasonable participation. Among those countries may be Singapore, England, Hong Kong, Germany, Canada, Russia, Australia, China, Japan, and South Africa. It may be anticipated that, in the next 7 to 10 years, Islamic financial products with required Shari’ah regulatory frameworks may attract almost 60-65 percent of the total financial industries globally, offering Islamic financial products to both Muslims and non-Muslims with beneficial results.

It is widely accepted that the adaptation of the Shari’ah compliant financial paradigm is one of the fastest growing areas of the international banking and finance in reality. The forecasts predict that there will be significant growth in this sector over the next five to ten years. However, this growth is dependent on successful risk management, professionalism, product innovation, regulatory frameworks, marketing strategies, research and discovery and customer satisfaction that all professionals, regulators, practitioners, customers and participants of the banking -financial industry must attend to. All these can be achieved only through the appropriate knowledge, information and exercises.

Rational Outlook of the Sustainable Growth of Islamic Finance

It is not simply a religious ground, but also socio-eco-cultural and other logistic, authentic and hypothetical reasons, which undeniably justify a sustainable growth of Islamic finance with promising track record. Thus, among the rational outlook of the growth of Islamic finance in the modern reality are pointed out by as follows:

Mutual Cooperation with Risk Sharing Culture

Islamic finance is not a mere product, but a holistic integrated system for all mankind  based on the Divine principle of Mutual cooperation with risk sharing culture for the legitimate benefit of all, irrespective of one’s religious background, race, color, gender, status or nationality. (See al-Qur’an 5:2)

Green Financing Platform

Islamic finance offers the ideal platform to boost ‘green financing’ and promote SRI (social responsibility investment). As Shari’ah rules prohibit participation in businesses involving alcohol, pork, and gambling, Islamic banks only support businesses that adhere to ethical and moral nature values when it comes to investments.

Shari’ah-Compliant Products

Demand for Shari’ah-compliant products continues to rise alongside a growing Muslim population. Muslims predicted to account for more than 25 per cent of the world population in 2013, growing twice as fast as the world’s non-Muslim population. Islamic banks address this group’s need and natural inclination to prefer Shari’ah-compliant financial products.

Fast and Steady Growth

The Islamic financing industry is growing 50 per cent faster than conventional banking. As of 2011, the global asset value of the Islamic finance industry is estimated to be at US$1 trillion. The figure is expected to reach US$5 trillion over the next five years. Indeed, there is no stopping the fast growth of Islamic banking with Islamic banks setting up shop in countries under the Gulf Cooperation Council (GCC), Malaysia, the UK, and even in Africa along with many other regions.

Attracts Non-Muslim investors

Even non-Muslim investors see the potential for profit in Islamic banking. Islamic financial products, as a rule, carry lower risk investments while enabling them to earn a profit and at the same time diversify their portfolio to further reduce risk.

Global Indexing

Western investors can track the Islamic financing industry through international rating systems. When purchasing sukuk or Islamic bonds, they can easily assess the strengths, weaknesses, and risk of the bonds by simply referring to benchmarks that track the financial industry.

Oil-rich Countries Adopt Islamic Finance

Countries belonging to the GCC want Shari’ah-compliant products for investment. Those belonging to this group are some of the wealthiest countries in the world. As the economies of Europe and the US struggle to stabilize, GCC nations are well-funded and their needs well met by Islamic banks.

Effective Decision-Making

Islamic investors avoid choices that cause harm to people and the environment. Through a thoughtful decision-making process, investors are able to make socially responsible choices that encourage investments that are good for the long-term.

Streamlined and Simpler

Islamic financial products, though they might also come with their own set of complex rules, are far simpler to understand than their conventional counterparts. For one, they are stricter with contracts and as focused. Islamic financial institutions also have scholars that offer consumers guidance with every venture and proceeding. They follow strict principles that ensure every single transaction is carried out according to Syariah law.

‘No Crisis’ Zone

Islamic financing saw a 25 per cent increase in value of assets from 2007 to 2008, while most of the world’s economies battled the worst financial crisis. It is, thus, safe to say that investing in Islamic financing is a possible way to avert potential crises in the world economy.

Humanitarian Concern

It is not against Islamic laws to accumulate wealth but all investors need to exercise awareness and shared responsibility for poverty in the world. Through the concept of zakat, or giving a portion of wealth to charity, Islamic finance aims to reduce economic disparity across the globe.

Industrial Catching Up

Malaysia’s Islamic assets reached US$65 billion in the financial year 2012/ 2013, reports the Ministry of Finance. National Islamic banking assets registered an average growth rate of 18 per cent to 20 per cent annually to reach US$ 65.6 billion. The government just invested in the development of human resources for the Islamic financing industry so as to ensure it catches up to the industry’s phenomenal growth.

Literature Initiative to Support the Growth of the Industry

 Trade& Finance:

Despite this development, quality refereed materials on Islamic law of trade and finance do not suffice the need yet. Thus, literally “Applied Islamic Law of Trade and Finance” (Sweet & Maxwell) provides possible practical exposition of the current Islamic law of trade and finance. Comparison with civil law highlights the differences between the systems and greatly assists in the understanding of both systems. Regular quotation of Qur’anic verses and prophetic traditions, with English translation, sets out the religious foundation underlying the applicable Islamic law of trade and finance in practical reality.

 The above title covers topics such as commercial contracts, sale of goods, partnership, capital market, Islamic currency, Takaful and the institution of Zakat. Islamic finance practitioners, bankers, lawyers, business owners and their financial and legal advisers may gain valuable information on the Islamic law of trade and finance with practical solutions.

 Islamic finance has grown exponentially in the last few decades and has reached over 70 countries around the world. The Islamic financial system today comprises a sizeable asset base and there is evidence of sustained demand for Islamic financial products and services in the global market, with demand outstripping supply.

The forthcoming title Applied Islamic Finance: Law and Practice from a Global Perspective provides a new source of reference to aid the understanding of the laws and practices of Islamic finance from a global perspective. Besides providing an overview of the regulatory structure overseeing the Islamic financial system, the book discusses the sources of law and the applied principles of Shari’ah governing Islamic financial instruments, products and policies. An entire chapter is also devoted to surveying the laws of several countries in the Muslim world that govern Islamic financial institutions.

As Islamic finance involves a wide array of global players including borrowers, lenders and their bankers, policy makers as well as legal and financial advisers, harmonization and rationalization are important to foster an efficient and dynamic system. To that end, the book discusses the Shari’ah standard of contemporary financial business, the roles and functions of a Shari’ah advisory body and the impact of fatwa in Islamic financial practices.

This book may be regularly consulted by banking and finance practitioners, in-house legal counsel, business owners, policy makers, participants, players, researchers and persons responsible for the further development of the Islamic financial system globally.

 Takaful& Re-takaful:

 The understanding of takaful (Islamic insurance) and modern insurance will be greatly enhanced by reading “Applied Takaful and Modern Insurance” with regulatory and practical consideration (Sweet & Maxwell). This book makes available in clear and succinct language the principles and practices of takaful and modern insurance with comparative treatment. The comparison of these two systems brings up the differences between and coincidence of both systems to facilitate better appreciation of the systems, which run in parallel to cover the various risks faced in life and reality today.

 The topics covered in this book include subject matter at risk, insurable interest, good faith, insurance contracts, risk management, insurance intermediaries, nomination, beneficiaries, claims, distribution and legal formalities. The contemporary experience in takaful operation is also discussed and recommendations are given for the future development of the industry in the contemporary world of advance economy.

The book has been useful for takaful, re-takaful and insurance practitioners, business owners, in-house Shari’ah and legal counsel, takaful or insurance advisors and persons responsible for risk management.


The increasing volume of Shari’ah-compliant business transactions backed by Islamic financial arrangements and the widespread use of the Internet and information technology (IT) make a good understanding of Islamic e-commerce law and practices very important. Being a developing area, good literature is not in abundance and it is the aim of a latest book, “Applied Islamic e-Commerce” (Sweet & Maxwell), may meet the need.

This book gives a practical and enlightening account of Islamic law comparing modern principles as they apply to the field of e-commerce with comparative treatment. Part I of the book sets out the general principles of e-commerce law, which include ethics in e-commerce and the sources of e-commerce law. Part II discusses the Shari’ah perspective comparing modern practical matters such as Internet marketing and advertising, virtual stores and payment systems as well as personal rights and the protection of privacy.

The practices of e-commerce law under Shari’ah compared with modern principles are explored in Part III. These include the components of an e-contract, the principles governing data protection and the concept and practical application of digital signatures. Part IV surveys offences and liabilities in e-commerce, particularly the problem with hackers and torts in e-commerce dealings under Shari’ah compared with modern principles.

Applied Islamic e-Commerce: Laws and Practice is an illuminating text and provides valuable guidance from the Islamic law standpoint compared with modern principles on practical issues which arise in the conduct of e-commerce. This is certainly a first book produced by considering Shari’ah standard comparing with modern principles and should not be missed by corporate lawyers, finance and business advisors, business owners, in-house legal counsel, marketers, IT professionals and those involve in e-commerce activities in business across the world.

 Strategies Ahead

Indeed, in the past Islamic financial industry had grown with hardship strategies, while the present movement is being achieved through dynamic strategic and smart applications with the potential to be an alternative component to the global conventional players. If such a phenomenon continues, the Islamic banking and financial platform may undoubtedly secure a sustainable place in the world’s growing financial picture.

For this to occur, due professionalism, public awareness, review exercises and product innovations must strictly be observed. Furthermore, dynamic mechanisms should be continuously researched to provide tools for risk management at all levels of Islamic financial industry. In addition, there must be adequate applications of relevant information technology (IT) to facilitate the smooth running of hi-tech Islamic financial activities. This will help meet the objective of providing the best and most competitive offerings for the present and the future.

Monday, January 20, 2014

Comment on "Cooperative Micro-bond (Sukuk)"

Monday, January 20, 2014 0

Bismillahir Rahmanir Rahim.

Firstly thanks for the delightful insight on the potential application of Sukuk Micro-Bond towards  financing the co-operatives operation. It had been my personal opinion, that with regard to the Islamic Microfinance, co-operatives can provide vital framework compare to bank, towards the success of Shariah compliant financing for the benefit of it's members and surrounding communities.

The inception of ANY co-operatives were based on mutual trust and consent among the majority members towards generating profitable ventures for the benefit of the shareholder. Only recently, especially in Malaysia, the word TRUST had been dropped from the co-operative name. But, in terms of spirit and objectivities, such term remains the binding force that ensure the co-operatives survival. Hence, with TRUST also being the cornerstone of success among any Sukuk Structures, the co-operatives Micro-Bond Sukuk implementation would be the next financial landscape to be observe.

Nevertheless, hereby in Malaysia and throughout the world, it's a sad note to observe that Sukuk financing were only restricted and limited to Corporate and Goverment entities. The ruling on the needs of Rating and Listing had constrict the beauty of Sukuk financing from the majority Islamic population. Thus, as in case of Malaysia, most of the co-operatives members were Muslim, such official ruling were tantamount in denying the right of Muslim masses to enjoy the benefit of Anti-Riba total financing solution.

As a prolific writer, speaker and distinguish scholar, you might have limited time to embark on new journey. Nevertheless, as an uneducated person in Islamic financing, I seek your precious advices and guidance, so that the first Sukuk implementation by a co-operative can be realized as the reference point for more successful case studies.

InSha'Allah. Wassalam.

Sallehuddin Sa'ad
Kota Bharu, Kelantan, Malaysia.
Reference Link :


Monday, April 1, 2013

Interview by Global Islamic Finance Magazine

Monday, April 1, 2013 0
INTERVIEW of Prof. Dr. Mohd. Ma'sum Billah
Global Islamic Finance Magazine 
(Leading Islamic Finance Intelligence Since 2007).

The issue of Franchising of Islamic Financial Products & Services with Global Approach.

The detail of the interview can be browsed through the following link:
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