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Page 2 of 4 The following are some sample letters this author permits you to reprint for the sake of promoting awareness among the banking community: Dear Sir or Madam, As a customer at Bank Conventional for some years now, I have wanted to do more than just hold a simple checking account. My home, car, and business financing requirements keep growing but, as a Muslim, I adhere to specific Islamic guidelines when making purchases, and your bank only offers interest-based alternatives. Islamic banking is growing all over the world and a number of major non-Muslim banks have begun to offer Islamic products. Would Bank Conventional consider doing the same? A number of my friends and family members are also keen to join Bank Conventional if you were to introduce Islamic banking. Just to give a few examples of some Islamic products at other bank: Savings Accounts: A number of Islamic banks offer savings accounts that provide monthly returns based on the equity principles of musharakah, or partnership financing. Car Leases: The substance of an Islamic lease, or ijarah, is quite similar to a conventional lease for car financings except for specific conditions relating to ownership, risk distribution and penalty clauses. Home Financings: The most common form of Islamic home financing is called a diminishing musharakah in which the bank and the buyer become joint partners in a property and the buyer purchases the bank’s equity while paying rent for what remains of the equity. Asset Financings: Growing numbers of Muslim businesses rely on a simple murabaha transaction to fulfill their short-term liquidity needs. In a murabaha, the customer selects an asset, for instance, machinery, which the bank buys on behalf of the customer and resells to the customer on a deferred basis at a profit, whether in installments or lump sum. This means that the sale of an asset takes place, creating a debt, rather than the sale of cash. If you would like, I am happy to send you more material describing Islamic banking. The principles of Islamic banking are very similar to those used in conventional equity-based banks and differ from interest-based banks primarily in matters of execution and ownership. The first and most important step in developing Islamic banking expertise is to contact a qualified Islamic scholar. I look forward to hearing your thoughts on the possibility of introducing Islamic banking at Bank Conventional in the near future. Regards, etc Dear Sir or Madam, As a customer at Bank Islamic, I am inquiring about Shari‘a compliancy at your bank. While I hold your bank in the highest regard, certain industry practices among less scrupulous banks motivate me to do some of my own research. Could you please give me specific responses to the following queries: Transparency: Does your Shari‘a advisory board have total visibility on all the contracts you use? Do they see exactly the same documents the customer sees? If so, please give me specific proof that this is the case. Authenticity: Do you use conventional contracts and simply replace the language with Islamic terminology or do you execute bona fide Islamic transactions? Kindly send me sample documents for each of your Islamic products. Qualification: The leading experts in the industry follow one of the four traditional schools of Islamic jurisprudence and have extensive training in the field. What are the backgrounds of the members of your Shari‘a advisory board? Additionally, I ask that you broaden your current product line. While I would like to continue to bank with Bank Islamic, my requirements keep increasing and currently you only offer (insert car, home, education, business, etc) financing. At the moment, I am in the market for (insert car, home, education, business, etc) financing. Kindly address these concerns because, while I find it inconvenient to deal with Islamic banks abroad, I am willing to make the move if I am not satisfied with Shari‘a compliancy at Bank Islamic. I look forward to your earliest response. Regards, etc. |