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The Impact of COVID-19 Pandemic on Islamic Finance According to the Dinar Standard Report 2021/2022
Author : Dr. Safwan Odaybat
Date Added : 11-09-2022

The Impact of COVID-19 Pandemic on Islamic Finance According to the Dinar Standard Report 2021/2022

 

COVID-19 pandemic had an evident impact on the economic, social, and political sectors of life. The Islamic finance sector is a key contributor to economic life worldwide, given its development and incremental aspects of growth in recent years.

Amongst the most important and precise technical studies indicating the impact of the COVID-19 pandemic on Islamic finance (2021/2022) in numbers is the report prepared by Dinar Standard in partnership with Salam Gateway with the support of DIEDC. This report was published by the International Islamic Center for Reconciliation and Arbitration (IICRA) in Dubai, Edition No. (19), 4rth quarter, 1443 H/June 2022.

The key points of this report are:

First: The value of Islamic finance assets in 2019 has risen from 2.52 trillion US dollars to 2.88 trillion US dollars amounting to 13.9%. The report expected this sector to recover over the coming five years with an overall growth by 5%.

Second: The rapid growth of the Islamic Takaful insurance, especially in the Gulf countries and Indonesia.

Third: 2020 witnessed a large number of initiatives and measures that help enhance the growth of Islamic finance, particularly in the countries of the Organization of Islamic Cooperation. In addition, it was decided to establish new Islamic banks in countries such as Tajikistan, Uganda and the Philippines, in addition to digital banks in Kazakhstan and Malaysia.

Fourth: The investment of Islamic Financial Technology as well as the combination Islamic financial institutions through out possession and combination that reached 4.93bn. in 2019 to 2020.

Fifth: The activity of the Islamic Sukuk decreased but didn`t stop where it was announced that new Sukuk were issued in south Africa, Nigeria, Britain, Gulf and south east Asia countries.

Sixth: Developing the sector of social finance through collective funding, fostering partnerships between the private and public sectors or supporting small and medium-sized finance institutions. 

Based on the above notes, the following can be noticed:

  1. Despite the fact that the report was prepared during the COVID-19 pandemic, Islamic finance has witnessed an evident growth and recovery is expected in the coming years. In the same year of preparing this report, the number of the Islamic finance institutions has reached 1462.
  2. Adopting social finance that rests on Takaful and cooperation between people to ease their problems, as is the case with Zakah (Alms giving) and Sadqah (Voluntary charity) and providing financial support to small and medium-sized financial institutions. Moreover, partnership between the private and public sectors is an example of this form of finance. New platforms have been established for collective funding between counterparts in Britain and Malaysia, and an initiative was launched to benefit from social Islamic finance in the UN in partnership with the Islamic Bank for Development in 2021 (news.UN.org).
  3. The COVID-19 pandemic encouraged Islamic finance to develop financial technology through modern electronic platforms, digital banks, and distinguished services of digital banking.
  4. Islami Sukuk have witnessed a remarkable growth within the recent years. As indicated by the report, this product hasn`t stopped despite the impact of the COVID-19 pandemic where their issuance was resumed in several countries. Here, it is worth pointing that later in the year 2021, the fourth issuance of the Sukuk for the Murabah to the purchase orderer were issued in favor of the Jordan National Electricity Company to fund the energy sector with a total value of 225 million JDs by an annual Murabaha percentage of 3.55% over five years.

Unequivocally, these notes indicate that the Islamic finance sector is replete with Sharia, technical, and legal competencies enabling it to face difficult situations, such as COVID-19 pandemic to create an opportunity to keep abreast with developments, innovate new products to address the needs of the people, and continue Islamic finance services.  

 

The published article reflects the opinion of its author

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Summarized Fatawaa

My husband discloses all our marital disputes to his family. What is the ruling of Islamic Law on this?

All praise is due to Allah, and peace and blessings be upon our master, the Messenger of Allah.
 
It is impermissible to divulge spousal secrets or expose one another's faults, whether during the subsistence of the marriage or after its dissolution. The foundational principle governing marital relations is that it is built upon confidentiality and mutual affection. Divulging marital secrets constitutes a breach of trust and a grave sin.
 
A husband ought not to resort to his family to complain about his wife over every dispute, nor is the reverse permissible for the wife, especially when such actions lead to stirring up malice and animosity between the spouses or between their respective families.
 
Islam has enjoined the preservation of secrets in general and commanded against revealing them; safeguarding the privacy of the home holds an even greater priority. And Allah Almighty knows best.

"I told my family at night: 'I will fast tomorrow as qaḍā' (a make-up fast),' but I forgot to make the intention before sleeping. Is my fast valid?"

All praise is due to Allah, and peace and blessings be upon our master, the Messenger of Allah ﷺ.
 
The intention is obligatory in acts of worship. For obligatory fasting, the required intention is to resolve to fast during the night [before dawn]. Its proper locus is the heart, while verbalizing the intention out loud in acts of worship is a sunnah — so that the tongue may align with the heart. If the intent behind the statement in question was the intention to fast, then it is valid; but if the intent was merely to inform someone, or reflected hesitation or doubt, then it is not valid.
 
It is stated in *Bushrā al-Karīm* (Vol.1/P.216): "It is a sunnah to verbalize the intention — that is, whatever has already been intended in the heart, whether an obligatory or a voluntary act — such as specifying the number of rak‘ahs, just before the opening takbīr — so that the tongue may assist the heart, and because this is further removed from whispered doubts (waswasah), and in order to accommodate the view of those who held it obligatory in every act of worship that requires an intention (even though this is a minority position), by analogy with Ḥajj."
 
Accordingly: if the intention to fast arose in your heart before the second adhān [i.e., before Fajr], then your fast is valid.
 
And Allah, the Exalted, knows best.

Is it a condition that a woman should untie her locks while making Ghusl (ritual bath)?

Ghusl from Janabah (ritual impurity), or menstruation obligates that water reaches the roots of the hair in order for the Ghusl to be valid, but if it doesn`t, then hair locks must be untied for water to reach them, and for Ghusl to become valid.

What is the ruling on a woman using contraception without her husband's knowledge if he is mistreating her?

All praise is due to Allah, and peace and blessings be upon our master the Messenger of Allah ﷺ.
It is not permissible for a woman to use any means of delaying pregnancy without her husband's knowledge, consent, and mutual agreement. This is because having children is a sharʿī right belonging to both spouses equally in Islamic law. Imām al-Māwardī, may Allah have mercy upon him, stated: "The right to a child from a free woman is shared between them both" — meaning between the two spouses. [al-Ḥāwī al-Kabīr, 9/320]
It is therefore not permissible for either spouse to make a unilateral decision regarding the prevention of pregnancy without the consent of the other. We advise both spouses to discuss the matter with wisdom and mutual respect, so as to resolve any disagreement and arrive at a suitable solution that serves the interests of them both. And Allah the Almighty knows best.

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