...FREQUENTLY ASKED QUESTIONS (FAQs) ON ISLAMIC BANKING Prepared by Mr. Imran Ahmad Mr. Ghulam Shabbir Islamic Banking Department State Bank of Pakistan Karachi. PART 1: RIBA AND INTEREST......................................................................................... 4 Question No. 1). What is Islamic Banking? ................................................................................................ 4 Question No. 2). What is the philosophy of Islamic banking?.................................................................... 4 Question No.3) What is Meant By Riba? .................................................................................................... 5 Question No.4) What is interest? Is there any difference between interest and Riba? ............................ 5 Question No. 5) What are the different kinds of Riba?.............................................................................. 6 Question No. 6). What are the revelations/verses in Holy Quran regarding prohibition of Riba/interest? ........................................................................................................................................................................ 7 Question No. 7) What are the sayings/Ahadith about Riba/Interest? .................................................... 10 Question No.8) Are there any injunctions against Riba/usury in religious texts other than Holy Quran? .......................................
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...Assignment Section 3 Study Questions Instructions Save the file in your Finance folder, and name it with Study, the section number, and your first initial and last name. For example, Jessie Robinson's study questions for Section 1 would be named Study1JRobinson. Answer the questions for each lesson on the same day that you read the lesson. Save the file before closing it each day. Then turn in your answers to the study questions at the end of the section. Review Lesson 4 of the Course Overview for instructions about turning in your study questions. Assignment Total score: ____ of 6.0 points Answer each question fully. Complete sentences are not necessary. Lesson 1 (Score for Question 1: ___ of 0.5 points) What is cash? Answer: Money in coins or notes, as distinct from check, money orders, or credit/debit cards. (Score for Question 2: ___ of 0.5 points) What is a bank balance? Answer: The amount of money held in a bank account at a given moment. (Score for Question 3: ___ of 1.0 points) Name at least two things to consider when choosing a bank. Answer: One is FDIC and the other is online banking option. (Score for Question 4: ___ of 1.0 points) Name at least two risks banks face. Answer: Loaning money that does not get paid back and interest rate increase. Lesson 2 (Score for Question 1: ___ of 1.0 points) 1. List the three main types of transactions. Answer: Deposit, withdrawal, and transfer. (Score for Question 2: ___ of 0.5 points) What are debit cards? Answer: Are small wallet sized...
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...Multiple Choice Study Questions Page 150 Chapter 12 General Multiple-Choice Questions 12.1 Money promotes efficiency because it A. reduces the search costs associated with finding a trading partner. B. encourages specialization by enabling trade (instead of production by everyone for his own use). C. reduces the information costs associated with trade, such as having to learn prices for several items. D. all of the above E. none of the above Money, according to our definition, A. has to be backed by something valuable, such as gold or silver. B. does not have to be generally accepted in payment of obligations. C. can include credit. D. has to be issued by government. E. none of the above. Money, according to our definition, A. need not be in common use. B. is generally accepted to pay debt. C. has to be issued by government. D. does not need to be useful to pay off obligations. E. needs to be backed up by gold. Which of the following has (have) functioned as money? A. gold B. tobacco C. rocks Money has to be based on, backed by, or redeemable in A. tobacco B. gold C. silver E. none of these D. cattle D. stocks E. all of these 12.2 12.3 12.4 12.5 12.6 Which of the following is not a function of money A. Unit of Account B. Medium of Exchange (Means of Payment) C. Store of Value D. Provider of Peace and Security E. Standard of Deferred Payments Which characteristics would not be especially important or practical for the thing used as money? A. Stable Value B....
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...Examination Paper of Banking & Financial Services Management IIBM Institute of Business Management Examination Paper MM.100 Principles & Practices of Banking Section A: Objective Type & Short Questions (30 Marks) This section consists of Multiple Choice & Short Note type questions. Answer all the questions. Part One carries 1 mark each & Part Two carries 4 marks each. Part One: Multiple Choices: 1. Frequency of First Tranche Returns is: a. Weekly b. Monthly c. Monthly/quarterly d. Monthly/quarterly/half-yearly 2. An order for winding up a banking company can be issued by___________ a. The High Court b. The RBI c. The Central Government d. The Supreme court 3. Who shall be natural guardian in case of married minor girl? a. Father b. Brother in law c. Father-in-law d. Husband 4. X a partner in the firm XYZ Co. wants to open a Bank account in the firm‟s name. It will require signatures of: a. All partners b. Any one of the partner c. Managing partner only d. Sleeping partner not required 5. Public limited companies should have minimum shareholders, before Opening Bank account. a. 11 b. 7 c. 5 d. 15 6. If the beneficiary is government then the Expiry of guarantee is governed by the „law of limitation‟ ranging from 3 years to a. 15 years b. 30 years 1 IIBM Institute of Business Management Examination Paper of Banking & Financial Services Management c. 20 years d. 10 years 7. Charge created on LIC Policy is a. Lien b. Hypothecation c. Pledge d. Assignment 8. The device that...
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...Examination Paper of Banking & Financial Services Management IIBM Institute of Business Management Examination Paper Principles & Practices of Banking Section A: Objective Type & Short Questions (30 Marks) This section consists of Multiple Choice & Short Note type questions. Answer all the questions. Part One carries 1 mark each & Part Two carries 4 marks each. MM.100 Part One: Multiple Choices: 1. Frequency of First Tranche Returns is: a. Weekly b. Monthly c. Monthly/quarterly d. Monthly/quarterly/half-yearly 2. An order for winding up a banking company can be issued by___________ a. The High Court b. The RBI c. The Central Government d. The Supreme court 3. Who shall be natural guardian in case of married minor girl? a. Father b. Brother in law c. Father-in-law d. Husband 4. X a partner in the firm XYZ Co. wants to open a Bank account in the firm‟s name. It will require signatures of: a. All partners b. Any one of the partner c. Managing partner only d. Sleeping partner not required 5. Public limited companies should have minimum shareholders, before Opening Bank account. a. 11 b. 7 c. 5 d. 15 6. If the beneficiary is government then the Expiry of guarantee is governed by the „law of limitation‟ ranging from 3 years to a. 15 years b. 30 years 1 IIBM Institute of Business Management Examination Paper of Banking & Financial Services Management c. 20 years d. 10 years 7. Charge created on LIC Policy is a. Lien b. Hypothecation c. Pledge d. Assignment 8. The device...
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...Examination Paper of Banking & Financial Services Management IIBM Institute of Business Management Examination Paper Principles & Practices of Banking Section A: Objective Type & Short Questions (30 Marks) This section consists of Multiple Choice & Short Note type questions. Answer all the questions. Part One carries 1 mark each & Part Two carries 4 marks each. MM.100 Part One: Multiple Choices: 1. Frequency of First Tranche Returns is: a. Weekly b. Monthly c. Monthly/quarterly d. Monthly/quarterly/half-yearly 2. An order for winding up a banking company can be issued by___________ a. The High Court b. The RBI c. The Central Government d. The Supreme court 3. Who shall be natural guardian in case of married minor girl? a. Father b. Brother in law c. Father-in-law d. Husband 4. X a partner in the firm XYZ Co. wants to open a Bank account in the firm‟s name. It will require signatures of: a. All partners b. Any one of the partner c. Managing partner only d. Sleeping partner not required 5. Public limited companies should have minimum shareholders, before Opening Bank account. a. 11 b. 7 c. 5 d. 15 6. If the beneficiary is government then the Expiry of guarantee is governed by the „law of limitation‟ ranging from 3 years to a. 15 years b. 30 years 1 IIBM Institute of Business Management Examination Paper of Banking & Financial Services Management c. 20 years d. 10 years 7. Charge created on LIC Policy is a. Lien b. Hypothecation c. Pledge d. Assignment 8. The device...
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...Islamic Banking: Answers to Some Frequently Asked Questions 9 ISLAMIC DEVELOPMENT BANK ISLAMIC RESEARCH AND TRAINING INSTITUTE ISLAMIC BANKING: ANSWERS TO SOME FREQUENTLY ASKED QUESTIONS Mabid Ali Al-Jarhi and Munawar Iqbal Occasional Paper No.4 1422H 2001 Mabid Al-Jarhi and Munawar Iqbal 10 Islamic Banking: Answers to Some Frequently Asked Questions 11Mabid Al-Jarhi and Munawar Iqbal 12 Islamic Banking: Answers to Some Frequently Asked Questions 13 FOREWORD In the last quarter of a century, there has been a great interest in the Islamic banking system both at private and public levels. There is an earnest and widespread desire to understand the system. Academicians, bankers and general public, all, have some genuine questions and concerns. Policy makers in the monetary and financial sectors of the IDB member countries have also often asked the Islamic Research and Training Institute (IRTI) some basic questions of theoretical and practical importance about the elimination of interest from the national economies of Muslim countries and the transformation of the prevailing conventional system to an Islamic one. Some of these questions reflect a desire to understand the basic concepts of Islamic finance while others relate to the creation of an enabling environment through macroeconomic reform and structural adjustments that are needed to establish the Islamic financial system and the complications that arise when an effort is made to bring about the transformation...
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...this case study is to analyze and answer the questions associated with reading the case study. There are a total of three questions each focusing on a specific idea within the case study. The answers to these questions can be seen below. 1. The first question pertains to open and closed-ended questions and the different information that is provided from the answers to each type of question. While the answers to these questions were unique, each category, both open and closed, provided invaluable information about the customer. The first analysis focuses on the open-ended questions which pertained to customer service perceptions. The questions that were asked pertained to the area of customer service that provided the customer with the greatest amount of satisfaction. The answers that were given were assigned a percentage based on the number of responses that matched each other. The most common responses were: the accessibility to discuss problems with customer service representatives which was 16%, the short amount of time it takes to resolve problems or issues which was 15%, the quality of the responses given by the customer service representatives which was 14% and the overall demeanor and strategy taken by the customer service representatives which was 11%. Each of these responses had one common thread and that was the personal attention and contact that the customer had with the customer service representative. The closed-ended questions provided a set of data that pertained...
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...The four players in the money supply process include Choose one answer. a. banks, depositors, borrowers, and the U.S. Treasury. b. banks, borrowers, the central bank, and the U.S. Treasury. c. banks, depositors, the central bank, and borrowers. d. banks, depositors, the central bank, and the U.S. Treasury. Correct Marks for this submission: 1/1. Question 2 Marks: 1 If a bank has excess reserves of $10,000 and demand deposit liabilities of $80,000, and if the reserve requirement is 20 percent, then the bank has actual reserves of Choose one answer. a. $16,000. b. $20,000. c. $36,000. d. $26,000. Correct Marks for this submission: 1/1. Question 3 Marks: 1 Because of the adverse selection problem, Choose one answer. a. lenders are reluctant to make loans that are not secured by collateral. b. lenders will write debt contracts that restrict certain activities of borrowers. c. good credit risks are more likely to seek loans causing lenders to make a disproportionate amount of loans to good credit risks. d. lenders may refuse loans to individuals with high net worth, because of their greater proclivity to "skip town." Correct Marks for this submission: 1/1. Question 4 Marks: 1 The effect of an open market purchase on reserves differs depending on how the seller of the bonds keeps the proceeds. If the proceeds are kept in ________, the open market purchase has no effect on reserves; if the proceeds are kept as ________...
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...What is Banking Ombudsman (BO)? * He hears customers’ complaints against banks. * BO was first setup in UK. * In India, RBI started this scheme in 1995. Appointment & Tenure * Earlier RBI used to appoint reputed persons from banking, finance, management, legal etc. sectors as Banking Ombudsmen (BO). * But now RBI has reserved this BO post for its own Chief General Managers and General Managers. * Tenure: 3 years at a time. * Reappointment: yes possible. Jurisdiction * Banking Ombudsman (BO) Scheme applies to whole of India (including Jammu and Kashmir). Banking Ombdusmen have jurisdiction over 1. All commercial banks (scheduled and non scheduled, public and private) 2. Regional rural banks 3. scheduled primary co-operative banks 4. NBFCs (BO’s Jurisdiction limited to “loan” part.) * BO is not a replacement of Consumer forum/courts. He merely supplements them. * BO deals with matters less than or equal to Rs.10 lakhs. * Here are some examples situation where BO can help you: Regular banking 1. Demand draft, cheques, pay orders etc. not issued on time. (or not paid on time) 2. Credit card related complaints (e.g. bank putting hidden charges. Your credit card was stolen but bank did not disable it even after you called them.) 3. You asked the bank to close your account / credit card but they are not doing it. 4. Bank refuses to open your account without giving valid reasons. 5. Bank closes down your account without valid...
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...* If you are working, why you want to leave your current job ? * Why banking sector and how you are the right person for it ? * What is your father's Job Background ? * What are NPA (Non-Performing Assets), how can u use technical knowledge in correcting the balance sheet? * How Can NPA be reduced ? * For unemployed people, which plans are addopted by government ? * Tell us About your native place and famous places near to it. * What was the Headline in Today's Newspaper?(Main Page and Financial Page Both). * What are functions of Banks and How does banking effect the economy of the country? * Difference between Fiscal and Moinetary Policy ? * Number of Districts in Your and Nearby States ? Governor, Chief Minsiter and Other Ministers of Your State (Like Education, Tourism Ministers )? * Latest Noble Prize Winners, Padam Awards Winners, Miss India, Miss World Miss Universe Etc. * How is Future growth of commercial banks in India and any hurdles to it ? * Banks VS NBFCs (Non Banking Finance Companies) ? * Questions About Budget 2013 - 14 and current five year plan. * Difference between Cheques, DD, Bill of Exchanges and Certificate of Deposit ? * Direct and Indirect Taxes In India. * Important People of India - Chief of Planning Commission and Election Commission Etc. CM and Governors of All States. * Where you want to see yourself after 5 Years? * Your Strengths and Weakness ? * RBI's Role in Economy...
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...300 Almost half of Americans use online banking and the statistic is growing. Banking is even going mobile. There are multiple banking applications available for smartphone users. If there’s not an “app” for your banking needs then there’s a strong possibility that your bank has a mobile version of their site making mobile banking easier than ever. How is internet/smart phone banking possible? The answer lies within the application and implementation of management information systems. These information systems contain components that work together to provide information. With the technology available today, banks have basically taken their information systems and expanded them to management information systems. Essentially using the data they already have but using it in a way to achieve business goals, such as the convenience of online banking. Before internet banking customers were forced to bank during the bank’s limited business hours, often time, banks opened after you were at work and would be closed by the time you got off work. Additionally, customers were forced to wait in excruciatingly long lines during peak business hours in order to handle their financial needs. Customers would have to endure all of that just to check the balances of their accounts. In order to better serve customers and their needs, internet banking was implemented. In the beginning, internet banking was extremely limited. Customers could check their balances and possibly...
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... Support your answer. Question 1: Describe the “hawala system.” What makes it successful among it’s users? Remittance is a transfer of money by foreign workers, relatives to his or her own countries. Monies sent home or transferred yearly by migrants constitutes the second largest financial influx to many developing countries. Estimates of these types of transactions range from $310 billion (according to the International Fund for Agricultural Development) to the World Banks estimate s of over $450 billion. Once such remittance program, which draws a great deal of attention, is the “hawala system” of remittance and/or payment. “Officials at Interpol and the International Monetary Fund estimates, that transactions within this system range as high a $700 billion dollars yearly” (Jost and Sandhu, 34). So, what is the hawala system? How does it work? What are the advantages of this system of finance? In an article written by Patrick Jost and Hajit Sandhu: “The Hawala Alternative Remittance System and It’s Role in Money Laundering (2010)…“Hawala is an alternative or parallel remittance system. It exists and operates outside of, or parallel to 'traditional' banking or financial channels. It was developed in India, before the introduction of western banking practices, and is currently a major remittance system used around the world. It is but one of several such systems; another well known example is the 'chop', 'chit' or 'flying money' system indigenous...
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...* Question 1 4 out of 4 points | | | M2 consists ofAnswer | | | | | Selected Answer: | M1 plus amounts in savings accounts, money-market mutual funds (held by individuals), and small time deposits (under $100,000). | Correct Answer: | M1 plus amounts in savings accounts, money-market mutual funds (held by individuals), and small time deposits (under $100,000). | | | | | * Question 2 0 out of 4 points | | | A mechanism by which a short-term loan is made, allowing a shopper to purchase goods or services today and pay at a later date, is known as a ________ card.Answer | | | | | Selected Answer: | debit | Correct Answer: | credit | | | | | * Question 3 4 out of 4 points | | | A type of inside money that allows a shopper to prepay some amount and then spend it at will is a ________ card.Answer | | | | | Selected Answer: | stored-value | Correct Answer: | stored-value | | | | | * Question 4 0 out of 4 points | | | A weighted average of the components of M1 and M2, with the weights dependent on the interest rates of each component, is known asAnswer | | | | | Selected Answer: | a simple-sum monetary aggregate. | Correct Answer: | a Divisia monetary aggregate. | | | | | * Question 5 0 out of 4 points | | | Money created in the private sector, such as checking accounts at banks, isAnswer | | | | | Selected Answer: | outside money. | Correct...
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...GET A JOB IN BANKING: The single most important thing you can do is to talk to as many people as you can. Talk to bankers and second years at SOM, learn about their experiences and views, and above all think for yourself. Getting a job in investment banking should involve two efforts on your part: (1) Learning your own needs - what is it you want in a job? (2) Learning what an investment bank is and does - does this type of job meets your needs? As a final warning, there is an allure to investment banking, namely that it is a high powered, fast-paced, exciting, dynamic career that can make you rich. This can be true, but it is also just a job - particularly as a first-year associate when it may not be as glamorous as you thought it would be. QUALITIES THAT INVESTMENT BANKS LOOK FOR It is important to see yourself as a portfolio of skills and qualities conducting an internet job search as well as any other. There are a number of skills and qualities that banks look for, and a successful candidate needs to put together several, but certainly not all of them. Additionally, it is probably a good idea to have some balance in your portfolio. Some qualities that banks look for on a resume or in the interview and some suggested ways to demonstrate them (these are just a few, and some banks will emphasize some more than others): Show a strong interest in Finance: Be able to convey to an interviewer/contact that you understand what investment banking is, what an...
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