| المستخلص: |
Financial systems are important components in development of economy of any given state. The differences in modes of banking between the Islamic banking and the conventional banking have been addressed in this research paper. Islamic banking has made some positive effects, including a positive image accorded to its operations. However, Islamic banking has been and will be even be challenged unless there are Shariah compliant instruments and products that yield similar outcomes like those of conventional banking. The concern that the financial sector in the US has over Islamic banking is the level of profitability and mode of operations to support growth in the economy. The hurdles for the banking institutions roots form the technical and motivational factors. On motivational matters, the basic objective seems to have been that of showing the viability of Islamic banking without the need of engaging in a lot of risk. It is undeniably that Islamic banks have recorded an impressive growth. Nevertheless, Islamic banking has always served as intermediaries between financial resources of major commercial banks in the United States and those of the Muslims. In light of this, this has been seen as a one-way relationship. There is yet to be a big Islamic bank outlet to develop means and ways of intermediating between the United States financial resources and the demand for them in the Muslim mother countries. Banking makes reference to the effects and outcomes of financial services and products that build. Through the views expressed by the respondents, a majority 85% were fully convinced that Islamic banking has a long way to go in establishing itself in the financial sector and being at a position where it can compete favorably with conventional banks. Islamic banks have some positive effect on the financial sector especially on credit risk and solvency matters. However, it faces challenges on profitability and liquidity matters.
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