One of the most widely acclaimed areas of banking in recent years is that of Islamic Banking. Many Islamic countries such as Saudi Arabia, Kuwait, and others such as Iran and Iraq, have a substantial number of their populations that subscribe to Islamic precepts, including those relating to banking. As some of the people in these countries and others have moved on to Western nations such as the United Kingdom and the United States, there have been continuing interest in ensuring that there are banking products for these groups, in ways that do not violate the tenets of their religion.
Research, knowledge, and creativity, are opening up the way for the banking system in the UK and elsewhere to satisfy the Islamic population groups in their communities, thus tapping into some of the wealth in the Arab and Islamic populations. London, dubbed The City, is known as one of the foremost banking centres in the world. As such, those in the banking community, have their pulse on what is going on around the world, in particular, with respect to meeting the banking needs of the well-heeled.
That Islamic Banking has attracted so much attention in The City is a testament to the growing importance both of the Islamic community and of the need for businesses to extend themselves beyond traditional comfort zones to meet new challenges and opportunities. In 2005 the Lord Mayor of the City of London, Alderman Sir David Brewer, launched the Islamic Finance Qualification (IFQ) which is meant to be a global benchmark examination focusing on Islamic Banking. This is meant to be a Computer Based Testing program, which also means that Islamic Banking is very much into the 21st century even though Islam itself dates back several centuries.
As the article “Lord Mayor London to Launch Islamic Banking…” notes, “The IFQ has been jointly developed over the last year by the Securities & Investment Institute (SII) and the Ecole Superieure des Affaires (ESA), to respond to the rapid expansion in the Islamic Finance and Banking sector. The Advisory Council for Islamic Finance responsible for the IFQ's development is chaired by the First Vice-Governor of the Banque du Liban, Dr Ahmed Jachi.
It comprises leading Sharia scholars and practitioners from around the Persian Gulf and the UK” (Lord Mayor to launch Islamic finance qualification 2000). It seems from the foregoing that the West has gotten smart with respect to dealing with sensitive issues such as culture and religion. The involvement of Sharia scholars makes it clear that this is not a Western package being foisted on Muslims, which at any rate would not have succeeded but that it has its provenance within the upper echelons of the Islamic community itself.
The success of Islamic banking outside the traditional Islamic enclaves has entailed a great deal of work on the part of important personages from around the world through consultations and conferences. One of the organizations that has been at the forefront of the promotion of Islamic banking is the Islamic Financial Criteria Organization, which was founded in 1991, and has been pushing for some kind of standardization across the board. “The Organization has around 130 members from 30 countries and has contributed to the boost of the Islamic financial and banking work which witnessed a noticeable growth of 15 percent over the last years” (Finance undersecretary heads to UK 2006).