The Objectives of the Prohibition of Riba By: Elhadi Habbani

Observing the objectives of the prohibition of Riba:

1- The contemporary Islamic structural contracts;

Since, Islamic financial institution is defined as "A depository/monetary institution of financial intermediation specialized in providing Finance in accordance with the tenets of Shari’ah especially realism. Morality and prohibition of Riba (interest)" . There is no difference, in the concept of intermediation, between Islamic and conventional intermediaries, both of them involve, mobilizing funds from surplus units, packaging size and maturity, and channel the mobilized funds to deficit units. The main differences only in the methodologies, principals, products, and financial structure. Therefore, Islamic intermediaries facing a very crucial challenges and tough competition in terms of efficiency, flexibility, innovation, compliance, and governance, which are required a unique and carful balancing between the need to comply with Shariah principals and to compete and prove quality and growth in a complicated and fast moving industry.
Although, the Islamic hybrid (structured) contracts have proven success and a respectful worldwide movement, whether they are traditional hybrid contracts such as Murabaha, BBA, Investment Deposit, Parallel Salam. Parallel Istisna, or contemporary hybrid contracts like, Lease Purchase, BOT, Revenue Sharing, Reversed Murabahah, Murabahah Line of Credit, Musharakah Overdraft, still need to exert more effort to at the first stage to enhance the existing hybrid contracts and the same time create new contracts.
The process, being difficult, it should keep close eye on the objectives of Shariah in general, and the objectives of the prohibition of Riba with dynamic open mind avoiding rigidness, inflexibility, and blind taking hold of the texts and false statements.

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