The Governance Of Islamic Banking: Trends And Challenges

Abstract

Although the general of awareness towards Islamic banking is widespread, there are still many challenges that are oftentimes too technical for the public at large to appreciate, especially among Islamic banking consumers. For these technical challenges, Sharī’ah scholars are often blamed but in actual fact there are other factors that need to be addressed. This paper outlines some of the critical  factors that influence the future direction of Islamic banking as well as identifying potential challenges those trends pose to Islamic Banking as an industry: Prudential Laws, the Accounting Standards, the International Banking Guidelines, the Academic Qualification of the players, the Market Advisors, the Islamic Banking Products and Taxation & Stamping Fees are among the critical challenges discussed. This paper seeks to create greater awareness of the challenges faced by the Islamic baking industry, which require a concerted effort by all stakeholders towards better governance.