The Perpetual Pain that Islamic Finance Industry Chose to Ignore

Sadia Karim Current Issues in Islamic Finance, Islamic Banking, Islamic Economy, Islamic Finance Leave a Comment

Caution: This is not an organized article. This is a rant or random chain of thoughts. It contains sensitive material that may appear undesirable expression to some.

I was browsing through the list of projects at Launchgood. Stopped and got stuck at this one “Riba Free Prescription: Fund my Interest Free Student Loan” . A deep emotion of sadness befell on me. Many thoughts were crossing through the mind. Phrases and questions like ‘hypocrisy of Islamic Finance’, ‘what Islamic Finance stands for’, ‘why am I still spending my time in Islamic Finance space’, ‘what is the motivation of someone who work for Islamic Finance industry’, ‘who are Islamic Finance industry’s primary beneficiaries’, ‘the state of the Ummah’- didn’t shy away from crossing those thoughts once again. Painful thoughts. Undeniable and brutal realities. These are moments in our lives that pop up suddenly. Then we deal with realities convincing ourselves with hundred plus excuses justifying those realities. Life goes on.

Several years ago when I was new to this field of Islamic Finance and with great enthusiasm was trying to find careers for other enthusiasts, I called in the organizer of a highly regarded forum that was happening that year and asked about human resources, career opportunities and how the forum will be addressing the issue so that we (Yurizk) can come as media representative to report on it. The first thing he vehemently objected to was the ‘media’ stating it’s a closed door forum. I was disappointed. Second thing he said was ‘there is no job in the industry’. Astonished I naively asked “How so! the industry says its growing at 15%-20% and there is dearth of professionals and need is so great?” He said “There is nothing wrong with the industry, but the people who are managing it”. And he asked me not to quote him. I understood. I cared not to attend the event at all as I did not have much purpose at that time after those revelations.

Being in the Islamic Finance industry is a journey. As a keen observer and avid researcher I learned probably more than what I deliberately aimed for in last 5 years. The summary is very small though if I put all the revelations from the learning in one page. The journey is not easy, rather a constant battle with full of questions that start with ‘why’s. It’s not that there is no answer, but the answers are most of the times painful to deal with.

In 40 years, Islamic Finance industry couldn’t find implementable solution to uplift the state of the Ummah. In 40 years, Islamic Finance industry couldn’t find implementable solutions to uplift the conditions of those who are less fortunate in the societies. In 40 years, Islamic Finance industry couldn’t find implementable solutions for the pain of the Muslim students across non-Muslim majority countries who are either compromising their faith with interest based student loans, or compromising with their dreams for the future.

In 40 years, Islamic Finance industry produced hundreds of academic researches, flooded financial markets with sukuks, but what good is in research when the researches are not solving these basic human needs and problems, what good is in sukuk if it’s not impacting the lives of average Bilal and Sana? In 40 years Islamic Finance found ways to make rich more richer, ways to help countries compete with each other economically, ways to innovate to make a square peg go through a round hole as smooth as possible. It didn’t focus on creating a square hole for itself accepting the round hole as the ultimate reality. It lacked vision, courage, and strategy to do that. Islamic Finance was not led by that kind of visionary, courageous, and strategic leadership who can challenge the status quo, be creative and strategic enough to keep the balance, and yet fulfill its inherent objective of doing the right things instead of being told to do what is right and follow through in compliance. The mindset of the generation may have a big role to play. The rest may be all geo-political reasons.

I am optimistic. I hope for a better future. Because looking the other way is not an option, not for our generation.

Millennials have grown up seeing chaos in the world. There is little peace and the loss of lives, properties, dignities, health, education have created an insatiable hunger for making changes for better. Fear is a powerful emotion. A degree of fear is necessary in life, but what we fear and why we fear is the key to know whether the fears are working as barrier or propeller in the causes we serve. Millennials are less fearful of material losses as they have seen so much loss, pain and suffering around the world. This gives tremendous hope because if we can remove the fear of losing material things, impossible can be made possible. We need to rise above those fears.

Coming back to where I began this post, in the 40 year history of Islamic Finance, no Muslim nation or organization or body did anything concrete or even exhorted strategic effort in solving the student loan issue for Muslims. May be because there is not much money to be made which begs the question about motivation or intent of Islamic Finance. United Kingdon, as it had been with its strategic step in CISI IFQ program that led the education space in the early days, did something very strategic in Sharia Compliant student loan issue in 2014 by seeking public consultation from Muslim communities on alternative financing options for student loan. The consultation was public and open to any group to suggest their models. Did even the effort put Islamic Finance industry in the OIC countries to shame? I doubt it. Hence ‘the state of the Ummah’!

What does it take to launch KIVA like platforms to solve this student loan issue? Is it too difficult? What is preventing someone from creating individual KIVA like platform for each of the sector of education: medical, engineering, media and journalism, pharmaceuticals, modest fashion, finance and other – all for funding higher education for Muslims across the globe, especially in the non-Muslim majority countries where the quality of education is high as well as cost of higher education is outrageous? This will not only help the Muslims, but to anyone who aspires to get the education he/she wants without being burned down with interest based loans.

Islamic Finance industry must know that productive millennials are no-nonsense generation. They don’t accept excuses. They are generation of researchers so information gap is not an excuse for them to understand a thing. They will not trust Islamic Finance industry’s value proposition if they don’t see problems being solved. What we need is solving the real human problems, problems of the average people on the street who are tired of either compromising their faith or their dreams.

I don’t put this challenge to the industry bodies because in the last 5 years I had a good learning curve, I put this challenge to the young adults (24-35) who may be reading this post – if you want to contribute to a greater cause, take this as a challenge – solve the problem of a generation who wants to dream big, get education without compromising their faith based values. If you can dream it, you can do it.

Get some inspiration from this video (watch below):

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