You are here

Credit-Related Practices of Islamic Banks in Comparison with Theory: Case Study of Turkey

Journal Name:

Publication Year:

Abstract (2. Language): 
The aim of this paper is to analyse credit-related practices of Islamic banks in Turkey in comparison with theory. Here, ‘credit-related practices’ are, first, the bank balance sheet item called ‘loans’ in general, and second, loans in terms of their types. By ‘theory’ we mean Islamic economics. In attaining the aim of this paper, we use comparative methodology depending on quantitative and qualitative research. In this context, we utilize quantitative methods like collecting calculating and representing -through figures and charts- relevant data, and qualitative methods such as searching through, selecting, summarizing and evaluating relevant literature and documents like agreements and reports concerning the subject. Some of the outstanding results of this paper are as follows; loans are the dominant use of funds for Turkish Islamic banks with changing ratios between 60- 75% for the period of December 2005-June 2015 and the main method used for loans is murabahah with 99.7% as of June 2015. Secondly, 91% of household loans are in the form of consumer credits as of June 2015, among which house loans are sweepingly dominant. Credits by individual credit cards have been on the increase until the second half of 2013.

REFERENCES

References: 

Aktepe, Emin, Ishak (2010), “Kredi Karti Sistemi ve Islam Hukuku
Acisindan Degerlendirilmesi”, Dinbilimleri Akademik Arstirma
Dergisi , Cilt 10, Sayi 1, ss. 133-1.
Amir, Vaisal; Hatimah, Husnul; Khalisah, Nur, and Purboyanti, Rini, Trah
(2015), “A Criticism of Annuities in Murabahah Transaction:
Allowing Riba Through Fatwa?”, Proceeding-Kuala Lumpur
International Business, Economics and Law Conference 6, Vol. 1,
April 18-19, 2015, Hotel Putra, Kuala Lumpur.
Asutay, Mehmet (2012), “Conceptualising and Locating the Social Failure
of Islamic Finance: Aspirations of Islamic Moral Economy vs.
Realities of Islamic Finance”, Asian and African Area Studies , Vol.11,
No. 2, pp. 93-113.
Credit-Related Practices of Islamic Banks in Comparison with Theory: Case Study of Turkey
58 Uluslararası İslam Ekonomisi ve Finansı Araştırmaları Dergisi, 2015, Yıl:1, Cilt:1, Sayı:2
Bacha, Obiyathulla, Ismath (1995), “Conventional versus Mudarabah
Financing: An Agency Cost Perspective”, Journal of Islamic
Economics , No. 4, No. 1-2, pp. 33–49.
Bayindir, Servet (2005), Islam Hukuku Penceresinden Faizsiz Bankacilik,
Ragbet Yay., Istanbul, Turkey.
Bendjilali, Boualem (2000), On the Demand for Consumer Credit: An
Islamic Setting, Islamic development Bank, Research Paper 30,
Second Edition, Jeddah.
Cebeci, İsmail (2012), Integrating the Social Maslaha into Islamic Finance,
Accounting Research Journal , Vol. 25, Issue 3, pp. 166-184.
Cebeci, İsmail (2010), Modern İslam İktisadı Literatüründe Murabaha
Tartışmaları , Yayinlanmamis Doktora Tezi, Marmara Universitesi
Sosyal Bilimler Enstitusu, Istanbul.
Cokgezen, Murat, and Kuran, Timur (2015), Between Consumer Demand
and Islamic Law: The Evolution of Islamic Credit Cards in Turkey ,
ERID (Economic research Initiatives at Duke) Working Paper 182,
Duke.
Dar, Humayon, A., and Presley, John, R. (2000), “Lack of Profit-Loss
Sharing in Islamic Banking: Management and Control Imbalances”,
International Journal of Islamic Financial Services , Vol. 2, No. 2, pp.
3-18.
Ernst&Young, (2014), World Islamic Banking Competitiveness Report
2014-15: Participation Banking 2.0.
Febianto, Irawan, and Kasri, R. A. (2007), “Why Do Islamic Banks Tend to
Avoid Profit and Loss Sharing Arrangements?”, 2nd Islamic
Economics Conference, Islamic Science University of Malaysia, Kuala
Lumpur.
Guney, Necmeddin (2014), “Murabaha Financing Revisited: The
Contemporary Debate on Its Use in Islamic Banks”, 5th International
Conference on Islamic Jurisprudence in the 21st Century, Department
of Fıqh and Ulul al-Fıqh, International Islamic University of
Malaysia, Kuala Lumpur.
Haron, Sudin (1998), “A Comparative Study of Islamic Banking Practices”,
J. KAU: Islamic Econ., Vol. 10, pp. 23-50.
Hasan, Zubair (2005), “Islamic Banking at the Crossroads: Theory versus
Practice”, Islamic Perspectives on Wealth Creation, Ed.: Munawar
Z. H. ORHAN ASTRÖM
International Journal of Islamic Economics and Finance Studies, 2015, Year:1, Volume:1, Number: 2 59
Iqbal and Rodney Wilson, Edinburgh University Pres., Edinburgh,
UK.
Hatta, Mohammad, Firdaus, Mohammad, and Dien, Mawil, Izzi (2014),
“Examining the Dominance of Islamic Debt-based Products in the
Economy”, International Journal of Arts and Commerce, Vol. 3, No.
6, pp. 13-28.
Idris, Umar, Mohammed (2012), “Effects of Islamic Credit Cards on
Customer Spending”, International Trade&Academic Research
Conference (ITARC), 7-8th November, London.
Kaya, Ferudun (2009), Turkiye’de Kredi Karti Uygulamasi , Turkiye
Bankalar Birligi (Banks Association of Turkey), No. 263, Istanbul.
Khan, Fahim (2010), “How ‘Islamic’ is Islamic banking?”, Journal of
Economic Behavior&Organization, Volume 76, Issue 3, pp. 805-820.
Khan, Fahim (2013), “An Alternative Approach to Analysis of Consumer
Behaviour: Need for Distinctive “Islamic” Theory”, Journal of Islamic
Business and Management, Vol. 3, No. 2, pp. 1-35.
Nagaoka, Shinsuke (2012), “Critical Overview of the History of Islamic
Economics: Formation, Transformation, and New Horizons”, Asian
and African Area Studies, Vol. 11, Number 2, pp. 114-136.
Nagaoka, Shinsuke (2007), “Beyond the Theoretical Dichotomy in Islamic
Finance: Analytical Reflections on Murabahah Contracts and Islamic
Debt Securities”, Kyoto Bulletin of Islamic Area Studies , 1-2, pp. 72-
91.
Presidency of Religious Affairs, (2013), Güncel Dini Meseleler Istisare
Toplantisi-III, 10-12 Aralik, Afyonkarahisar.
Qureshi, Anwar, Iqbal (1945, 2003), Islam and the Theory of Interest , Kitab
Bhavan, New Typesetting, New Delhi, India.
Rosly, Saiful, Azhar (1999), “‘Al-Bay’ Bithaman Ajil Financing: Impacts on
Islamic Banking Performance”, Thunderbird International Business
Review, Vol. 41, Issue 4-5, pp. 461-80.
Samad, Abdus; Gardner, Norman, D., and Cook, Bradley, J. (2005),
“Islamic banking and finance in theory and practice: The experience of
Malaysia and Bahrain”, The American Journal of Islamic Social
Science, Vol. 22, No. 2, pp. 69–86.
Credit-Related Practices of Islamic Banks in Comparison with Theory: Case Study of Turkey
60 Uluslararası İslam Ekonomisi ve Finansı Araştırmaları Dergisi, 2015, Yıl:1, Cilt:1, Sayı:2
Siddiqi, Muhammad, Nejatullah (2006), “Islamic Banking and Finance in
Theory and Practice: A Survey of the State of the Art”, Islamic
Economic Studies, Vol. 13, No. 2, pp: 2-48.
Siddiqi, Muhammed, Nejatullah (1983, 2006), Banking Without Interest ,
The Islamic Foundation, Reprinted, Leicestershire, UK.
TKBB (Participation Banks Association of Turkey), (2014), Katilim
Bankalari 2014, TKBB, Istanbul.
Tripp, Charles (2006), Islam and the Moral Economy: The Challenge of
Capitalism, Cambridge University Press, Cambridge, UK.
Venardos, A. M. (2010) (ed.), Current Issues in Islamic Banking and
Finance: Resilience and Stability in the Present System, World
Scientific Publishing Co. Pte. Ltd., Singapore.
Weill, Laurent, and Godlewski, Christophe (2012), Why do large firms go
for Islamic loans?, BOFIT (Bank of Finland, Institute for Economies
in Transition) Discussion Papers 7, Helsinki.
Yousef, Tarik, M. (2004), “The Murabaha syndrome in Islamic finance:
Laws, institutions and politics”, The Politics of Islamic Finance, Ed.:
Clement Henry and Rodney Wilson, Edinburgh University Press Ltd,
Edinburgh, UK.
Zubairu, Umaru, Mustapha; Sakariyau, Olalekan, Busra, and Dauda,
Chetubo, Kuta (2011), “Social Reporting of Islamic Banks in Saudi
Arabia”, International Journal of Business and Social Science , Vol. 2,
No. 23, Special Issue, pp. 193-205.

Thank you for copying data from http://www.arastirmax.com