Course Details

Training on Shariah-Compliant Islamic Banking

INTRODUCTION

Islamic banking is a system of banking that adheres to the principles of Islamic law (Shariah), which prohibits the collection and payment of interest (Riba) and promotes risk-sharing and ethical financial practices. Shariah-compliant banking has grown significantly over the last few decades and is now a key component of the global financial system, serving both Muslims and non-Muslims alike.

This training course on Shariah-Compliant Islamic Banking is designed to provide participants with a comprehensive understanding of Islamic banking principles, financial instruments, and the regulatory framework. It aims to equip participants with the knowledge and skills needed to operate within Islamic banking frameworks while ensuring compliance with Shariah guidelines.

This Shariah-Compliant Islamic Banking training provides an in-depth understanding of the principles, practices, and products of Islamic banking. By the end of the course, participants will have a solid grasp of how to design and manage Shariah-compliant financial products, assess risks, and ensure compliance with Islamic laws. This training also emphasizes the growing global demand for Islamic banking and the opportunities it presents for financial inclusion and ethical finance.

DURATION

10 days

TARGET AUDIENCE

• Bankers and finance professionals
• Entrepreneurs and business owners
• Legal and compliance officers in financial institutions
• Islamic scholars and Shariah advisors
• Academics and researchers in Islamic finance
• Government regulators and policymakers
• Students interested in Islamic banking and finance

COURSE OBJECTIVES

By the end of this training, participants will be able to:

1. Understand the Fundamentals of Islamic Banking: Learn the core principles of Islamic finance and how they differ from conventional banking systems.
2. Comprehend Shariah Principles in Finance: Understand key Shariah concepts like Riba (interest), Gharar (uncertainty), and Maysir (gambling), and how they apply to Islamic banking.
3. Identify Shariah-Compliant Banking Products and Services: Explore the various Islamic financial products such as Murabaha, Ijara, Musharakah, and Sukuk, and their applications.
4. Understand the Role of Islamic Banking in Financial Inclusion: Learn how Islamic banking promotes financial inclusion by offering ethical, interest-free solutions.
5. Ensure Shariah Compliance: Gain insights into the mechanisms used by Islamic banks to ensure adherence to Shariah laws, such as the role of Shariah boards and auditors.
6. Apply Risk Management in Islamic Banking: Understand the unique risk-sharing models used in Islamic banking and the regulatory framework surrounding them.
7. Examine Case Studies of Islamic Banking: Analyze real-world examples of Islamic banking practices from different regions, focusing on both challenges and success stories.

 COURSE CONTENT

Module 1: Introduction to Islamic Finance and Banking

• Overview of Islamic finance and its historical context
• Basic principles of Shariah-compliant finance
• Differences between Islamic and conventional banking
• The ethical foundation of Islamic finance: Profit-sharing, risk-sharing, and fairness

Module 2: Key Concepts in Islamic Banking

• Prohibition of Riba (interest) and its significance in Islamic finance
• Understanding Gharar (excessive uncertainty) and Maysir (speculation/gambling)
• The principle of Halal and Haram in financial transactions
• Role of Islamic ethics in banking and finance

Module 3: Islamic Banking Contracts and Products

• Murabaha (Cost-plus Financing): How it works and its common uses in trade and home financing
• Ijara (Leasing): Understanding Islamic leasing structures
• Musharakah (Partnership): Joint venture financing in Islamic banking
• Mudarabah (Profit-sharing): Investment partnerships between the bank and entrepreneur
• Sukuk (Islamic Bonds): Asset-backed securities in Islamic finance
• Takaful (Islamic Insurance): Cooperative risk-sharing insurance

Module 4: Shariah Compliance Mechanisms

• Role and function of Shariah supervisory boards in Islamic banks
• Shariah auditing and governance structures
• Procedures for issuing Fatwas (Shariah rulings) for financial products
• The role of Islamic scholars in ensuring product and service compliance

Module 5: Risk Management in Islamic Banking

• Unique risks in Islamic banking (e.g., asset-based financing, credit risk, operational risk)
• Risk-sharing mechanisms in Islamic finance contracts
• Capital adequacy and liquidity management under Islamic banking
• Understanding Basel III compliance and Islamic banks

Module 6: Islamic Financial Markets and Instruments

• Overview of Islamic financial markets and their role in economic development
• Islamic money markets and interbank operations
• Role of Sukuk in Islamic capital markets
• Ethical investing: Shariah-compliant equity investments and mutual funds

Module 7: Islamic Banking and Financial Inclusion

• Promoting financial inclusion through Shariah-compliant microfinance
• Islamic social finance tools: Zakat (almsgiving), Waqf (endowment), and Sadaqah (charitable giving)
• Case studies of Islamic banking’s role in poverty alleviation and SME development
• Challenges in extending Islamic financial services to underserved populations

Module 8: Regulatory Framework for Islamic Banking

• Overview of international standards for Islamic banking (AAOIFI, IFSB)
• Regulatory challenges and solutions for Islamic banks operating in conventional environments
• Central banks and the regulation of Islamic finance
• Case studies of successful regulatory models from the Middle East, Asia, and Africa

Module 9: Case Studies and Best Practices in Islamic Banking

• Case studies from leading Islamic banks (e.g., Dubai Islamic Bank, Al Rajhi Bank)
• Lessons from the growth of Islamic banking in Southeast Asia (Malaysia, Indonesia)
• Practical examples of successful Islamic finance structures
• Group discussion on the application of Islamic banking principles to different markets

Module 10: Practical Exercises and Application

• Hands-on exercises: Developing Shariah-compliant financial products
• Role-playing exercises: Managing an Islamic bank’s Shariah board
• Group activities: Designing risk-sharing models and financial contracts
• Presentation and feedback sessions

 CERTIFICATION

• Upon successful completion of this training, participants will be issued with Macskills Training and Development Institute Certificate

TRAINING VENUE

• Training will be held at Macskills Training Centre. We also tailor make the training upon request at different locations across the world.

AIRPORT PICK UP AND ACCOMMODATION

• Airport pick up and accommodation is arranged upon request

TERMS OF PAYMENT

• Payment should be made to Macskills Development Institute bank account before the start of the training and receipts sent to info@macskillsdevelopment.com