Growth and prospects of Islamic banking in

Pakistan

Description of Research paper:

This research paper explain four question that are follow

What is Islamic banking?

Are the Islamic banks growing?
What are the prospects of Islamic banking in Pakistan?
What are the challenges being faced by Islamic banks?

Purpose of paper:
The purpose of this research paper is generally to explain that
whether Islamic banks are growing or not and what are future possibilities
of this bank is the present growth shows that the future of Islamic banks are
bright or not.

Summary
Islamic banks follow the holy Quran and suunah the basic philosophy of
Islamic banks is to give protection to the property of people and finish the
injustice in society .the basic are concept by which Islamic banks
differentiate from conventional banks as follow (1) prohibition of Riba (2)
risk sharing (3) materiality (4) legality (5) avoid of Gharar. The financing
modes of Islamic banks are Modaraba, Musharakah, Murabaha, Salam,
Ijara and Istisna.
The following are the factors by which the growth can be measured i-e
number of Branches, number of institution, total Asset, amount of deposit,
net financing and investment. From 2003 to 2010, the following are the
results.

 In 2003, the total asset by Islamic banks were PRs13 billion and in
2010 it is increased to PRS 477billion
The total deposits also increased from 8billion to 390billion,in 2003 to
2010
In 2003, the net financing and investment were 10billion but in 2010,
it is increased to 338billion
The number of institution also increased from 4 to 17
The number of branches also increased from17 to 751
From the above discussion, it is conclude that Islamic banks are
going toward success. Pakistan is a Muslim country, so the chances of
success here is high in future. The result of number of branches,
institution, Assets, Deposits and net financing and investment shows
that the future of Islamic Banks is bright.
There are some challenges that are faced by Islamic banks i-e they do
not have their centralized Boar of Shariah due to different school of
thoughts. Secondly Islamic banks should provide more risky
management tool. Thirdly small banks cannot compete with globally
expanding international banks, so they need to create mutual
understanding to cooperate. Fourthly Islamic banks offered up till now
30 kinds of product, so there is need of for further diversification in
products i-e should increase their number of products. Lastly Islamic
banks should follow reliable accounting procedures and sharia compliant
standard.