Implication of hawalah in Islamic finance practice
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This article aims at examining the concept of Hawalah and its contemporary applications in banking sector. For this purpose, the authors examine the conceptual and literal meaning of Hawalah and scrutinise its applications in two Malaysian banks. While Bank A is a dual bank which offers both conventional and Islamic banking, Bank B is a full-fledged Islamic bank. Results indicated that there is a general lack of awareness about the concept of Hawalah used by both banks. Although there is strong awareness of Islamic Shariah's strong prohibition on taking interest, the staff members are uninformed about the underlying concepts of Hawalah. In addition, the authors found that the hawalah-based services offered by both banks were not significantly different from conventional banks' products and services. It is recommended that further research can be conducted to find out the reluctance among the Islamic banks to name remittance system by using the term hawalah.
Shariah , Funds transfer , Hawalah , Islamic finance , Islamic banking , Remittance
Al Raisi, A. K. S. D., Rodriguez, I., Tustikbayev, M., Omarova, N., Abdul Rahman, W., & Muneeza, A. (2016). Implication of hawalah in Islamic finance practice. International Journal of Management and Applied Research, 3(3), 109-119. https://doi.org/10.18646/2056.33.16-009
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