An Analysis of Imposed Charity (Iltizām-e-Taṣadduq) in Islamic Banking

اسلامی بینکاری میں التزامِ تصدق(مالی جرمانہ) کا تجزیاتی مطالعہ

Abstract

There are many new alternatives adopted by Islamic banks for the interest-based transactions of conventional banks. One of them is Imposed Charity (Iltizām-e-Taṣadduq) for the monetary penalty on late payment. But it is argued by the Sharia’h scholars that it is nothing but a forbidden monetary penalty. This thesis describes the need and mechanism of the imposed charity and puts forward  the arguments of the scholars on it with the answers from Banking practitioners. This will help us to weigh different stances on the subject.