Principles of Islamic Finance: Prohibition of...

Principles of Islamic Finance: Prohibition of Riba Gharar and Maysir

Author Name : Sharafudheen E K

ABSTRACT

Islamic finance, a complete rule based Islamic financial system, forming a necessary base which are originated from revealed verses of the Holy Quran Quran considered direct order from the God and the practices of Prophet Muhammad commonly known as ahadith .Although  the consept of islamic finance is as old as its religion itself but in middle age muslim diverted from original technique islam, Only recently Islamic finance was remerge . Therefore, it is essential to understand the fundamental rules that make Islamic finance different from its counterpart. In this paper an try to discuss briefly fundamental principles of Islamic finance namely prohibition of Riba (interest), Gharar (uncertainty) and Maysir (gaming).It is found in the study that these principles are based on the fundamental sources and early Islamic  expert writer low, scholars and contemporary researchers uphold them in carrying out financial transactions.In order to run financial system according to the Islamic principles these concepts must be understood clearly and all transactions must be free from them.

Key words: Islamic finance, Riba, Gharar, Maysir