"So these are some of the concerns Grateful. Kind regards Vickie (PS - unable to respond for a day or two if you want to continue)"

Yes i would mind carrying on the discussion. However, I will be away for a week so it will not be until about wed that i'll be able to rejoin the discussion.

But quickly, as for the "rebadging" charge that is a criticism that is made within the Islamic Finance community (i quoted Al-Gamal) and is part of a robust debate over how to implement the Shariah with regard to finance. As you have pointed out there are a lot of challenges...but there are also a lot of smart people working to meet those challenges. The outcome will be of benefit to everyone, not just Muslims.

Hi Vikkie,

I'll be heading off somewhere for a week, by when i return i'd like to examine more closely what you said in relation to the Bible and the taking of interest.

Being ignorant of the subject i looked up wikipedia topic "Loans and interest in Judaism". It seems from this reading that the Bible does prohibit interest, although the Jews would permit lending with interest to Gentiles (1st reading below). This exception was convenient for Christians in medieval times seeking a way around the usury laws since the Church did not apply the ban to non-Christians (2nd reading below).

From an outsiders perspective it appears like Jews and Christians are not observing their own scriptures
cont..

cont..

1st Reading on Jewish scripture
"The Torah expresses regulations against the charging of interest in the Exodus 22:25–27, Leviticus 25:36–37 and Deuteronomy 23:20–21. In Leviticus loans themselves are encouraged, whether of money or food, emphasizing that they enable the poor to regain their independence, , like the other two places in the Bible, forbids the charging of interest on the loan.[5] All three places state that the charging of interest is exploitative. In Exodus and Deuteronomy it is clear that it would be acceptable to charge interest on any loan to a non-Jew.[5]"

In regard to Christian practice:

"The early Christian Church, for reasons connected to the New Testament, declared that any usury was against divine law, preventing pious and outwardly pious Christians from using capital for mercantile purposes;[1] in 1179, Pope Alexander III excommunicated usurers, which was seen as an extremely harsh punishment.[1] However, Canon law was not regarded by medieval society as having any authority over Jews, and thus Christian monarchs looked to the Jews to supply capital to them;[1] in many European countries, medieval civil law also allowed the monarchs to inherit all remaining income and property that had been acquired by usury upon the death of the Jewish usurer involved.[1] Medieval European monarchs thus supported the Jews and suppressed any attempts to convert them to Christianity since it would deprive the monarch of potential income;[1] in England and France, the monarchs demanded compensation from the church for every Jew who was converted, and, until 1281, the English monarch had the legal right to claim half the property of any Jew that converted to Christianity.[1]"

Hi Grateful
re Exodus 22:25-27: This reads clearly that it's lending money to the needy among your own people. I gave the example of my aunt lending to me for my first car. The instruction was to do this 'not like a moneylender' - so don't charge your own relatives interest. We agree on this but its about charity not a commercial transaction. Lev 25:35-37 is again about lending to the poor among you...and Deut 23:20-21 is clear you can indeed charge a foreigner interest as in these ancient times 'businessman would come into Israel for financial advantage and so would be subject to paying interest.' (This is from the commentary in my NIV study bible for this verse). Commercial law is different from how we treat our own relatives. A business investment should grow - it is not charity.
The Church quote you cite reflects a time in history where the church and state were conflated and corrupted. It is clear from the example given earlier where Jesus uses a parable that condemns a follower for burying his talent and not even investing it and gaining interest, that interest itself was not a problem for him. Jesus taught to worship in 'spirit and in truth'. (John 4:24) The spirit of the law that it is, rather than the letter (which Paul said 'kills' - 2 Corinthians 3:6). The spirit of the law is to lend without interest to our own - (1 Timothy 5:8 says if we don't provide for our own relatives we are worse than unbelievers). But to keep this to the letter as you suggest 'kills' growth and opportunity. The separation of church and state has a lot to do with this - they are different realms. This is one of the issues with sharia law which tends to unite these things not making any distinction. All relationships are not the same and our personal dealings and commercial dealings (while not advocating for 'excessive' interest) are indeed different.

The last few posts show quite clearly that religious beliefs provide absolutely no consistent guidance when it comes to financial matters.

Which should not be particularly surprising. Any biblical/Torah/Qur'an extracts were written well before any of the modern banking schemes were even considered. While they may be a relatively accurate representation of societies that existed fifteen hundred/two thousand/twentysix hundred years ago, they can hardly be relevant as a guide to modern business practices.

If you extract from them their moral message - which is, I submit, their primary role - their intent is clearly to reinforce the socially-responsible message of "do not exploit".

Trying to forcibly pack these teachings into a commercial framework is always going to be unsatisfactory, and leave a load of straggly bits left over, that inevitably respond to different interpretations.

And Vickie, you are taking the narrowest possible view of the situation by linking this assertion with the concept of interest:

>>A business investment should grow - it is not charity<<

All bankers - Jewish, Christian, Islamic - are in complete agreement with you on this statement of yours. But by confining your attention to the concept of interest, you are ignoring the fact that all parties in a financial transaction have a say in its constitution. If interest suits, fine. If sharing cap[ital growth suits, then that should be fine too.

Somewhat oddly, you show that you do actually understand this:

>>All relationships are not the same and our personal dealings and commercial dealings (while not advocating for 'excessive' interest) are indeed different.<<

If this is your understanding, why do you advocate that there be only one permissible form for financial transactions?

Perciles - we agree on something... that faith based investments are essentially those that 'do not exploit'.
The whole discussion here has been about how, in what specific way, can sharia finance be considered more ethical - as it claims. Is this a true or false claim. I am suggesting that this is a false claim. That actually sharia finance may be exploiting the good will of people, veiling interest by simply redefining it, and investing in things that support discriminatory positions against others. (eg the Dr Ehrenfeld case study previously mentioned that found sharia boards unwilling to invest in what may be considered 'Jewish or Christian'...ie things needing to be Islamically cleansed - not a good example of a product being 'inclusive' as it claims - it is these attitudes that taken to the extreme are resulting in untold deaths around the world of minorities in Muslim majority nations and promote a theology of segregation here). So the question of ethics - and whose ethics - is what we are talking about. According to the Judge previously cited, there are people who fall on hard times and have defaulted on their sharia loan and in the (Muslim) judges opinion - have been exploited by sharia norms. So is this more ethical than conventional finance as claimed? It is the false claim that concerns many and the sanctioning of sharia 'anything' in general because sharia compliance supports many radical agendas.