What is Shariah?

Islam is more than a religion; it’s also a way of life that contains a code of laws and ethics that deal with social, economic and political matters. Muslims are expected to live according to Shariah in all aspects of life. Shariah places restrictions on the types of finance and investments that are permissible for the Muslim community. Islamic finance can be defined as the body of financial contracts and rules that have been adopted from the rich heritage of scholarly research in Fiqh Muamalat (Islamic law of transactions) and modified to comply with modern banking regulations while remaining in accordance with the principles of Shariah. In Islam, money must be used in a productive way, and generating the return on your money must be done through Islamically legitimate and ethical trade or investment. According to Shariah, group investments must include an element of risk sharing and ideally, it should be confirmed that the investee will use the funds in a manner permissible in Islam. Generating interest on money is seen as income through exploitation and is fully prohibited in Islam. Shariah also does not permit trade or investment in unethical industries or commodities, such as arms, gambling, alcohol, conventional banking or insurance, non-halal food or beverages, non-Halal entertainment and more.