Islamic Finance Methods
Chapter from the book: Kılıç, E. (ed.) 2023. Theoretical and Empirical Studies on Money and Capital Markets.

Mehmet Bükey
Bingöl University
Yavuz Türkkan
Bingöl Üniversitesi

Synopsis

In this study, Islamic finance methods that are operated according to Islamic principles will be introduced. As it is known, Islamic finance methods, unlike traditional finance methods, are not a financial activity but a commercial method. Financing in Islamic finance is based on the profit share principle, not the interest principle of traditional finance. Islamic finance methods include different financing techniques to meet the needs of Islamic entrepreneurs who want to meet their financing needs. In these techniques, money is not seen as capital or as an income generating tool. Money is accepted as a means of exchange and a unit of measurement in the valuation of commercial activities, productivity and increase in social welfare. In Islamic finance methods, financing is provided for the purchase of investments, goods, services or fixed assets. Financial transactions are in no way based on mutual monetary transactions. Monetary transactions are made in return for goods or services and do not include interest. At the same time, all transactions do not contain any uncertainty. In the study, Islamic finance methods are discussed under the title of four basic methods. These basic methods are Support Methods, Trading Methods, Partnership Methods and Other Financing Methods.

How to cite this book

Bükey, M. & Türkkan, Y. (2023). Islamic Finance Methods. In: Kılıç, E. (ed.), Theoretical and Empirical Studies on Money and Capital Markets (pp. 217-248). Özgür Publications. DOI: https://doi.org/10.58830/ozgur.pub41.c57

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Published

January 30, 2023

DOI