Most appropriate profit distribution method for Islamic banking: ISR Vs Weightage
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Date
2022-09Publisher
Brac UniversityAuthor
Alif, Tanveer RahmanMetadata
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Just like the Middle East, the Islamic Banking is a growing market for Bangladesh as well. In the
past few years, some of the banks have started Islamic banking in a full-fledged manner. Islami
Bank Bangladesh Ltd is a notable example of a full-fledged Shari’ah banking. On the other hand,
there are other banks which have assessed the market potential of Islamic Banking in Bangladesh
and jumped on to the train by opening a Islamic Banking wing aside from their conventional
banking. City Islamic and MTB Yaqeen are some of them. In this study, we have analyzed the
most suitable profit distribution mechanism for Islamic banks. Because, many conventional banks
of Bangladesh follow a common method named weightage. But a question remains as to how
appropriate or ideal is this method for Islamic banking. This study is a compare and contrast of
two profit distribution methods named ISR and Weightage. It is an effort to make the readers
understand which of the method is more Shari’ah compliant.