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Imams Learning Islamic Finance

Islamic Finance

First Posted: 07/22/2011 9:49 am Updated: 09/21/2011 5:12 am

By Omar Sacirbey
Religion News Service

(RNS) Abdullah Nana, an imam at the Islamic Center of Mill Valley, Calif., just north of San Francisco, has a distinct advantage over many of his fellow imams in the United States.

It's not fluency in Arabic or training in Islamic jurisprudence. It's his bachelor's degree in business.

American imams get asked about financial ethics more than any other topic, Nana said, yet he calls it the subject that they are least qualified to talk about with congregants.

Nana was part of an inaugural group of 100 imams to go through a three-day training program sponsored by the newly established American Islamic Finance Project.

"The real challenge for Islamic finance is working within the legal framework of this country," said Nana, who estimated that a quarter of the hundreds of questions he gets every year from U.S. Muslims relate to finance.

For example, Islamic law requires that banks own a home before it is resold to a home buyer, but U.S. law doesn't allow banks to own a house on someone else's behalf.

Islamic finance is a set of rules and regulations derived from the Quran, the teachings of Prophet Muhammad and scholarly interpretation, but opinions vary tremendously. For example, some say the Islamic prohibition of usury applies to all interest, while others say it is against excessive interest.

Indeed, in 2000, Islamic scholars from North America and Europe issued fatwas saying it was permissible for Muslims in Western countries to get mortgages because the Islamic duty to be a responsible citizen -- including home ownership -- overrides the Islamic prohibition on interest.

A decade ago, there were almost no Islamic financial institutions in the U.S. Today, there are a few dozen Islamic financial institutions, as well as several major mainstream banks, such as HSBC and Deutsche Bank, that offer Islamic financial products.

"I personally believe there are enough options for Muslims to get Shariah-compliant loans," said Imam Tahir Anwar of the South Bay Islamic Association in San Jose, Calif., who believes in a total prohibition on interest.

The imam-training project was established by the Indianapolis-based Islamic Society of North America (ISNA), the largest Islamic organization in the U.S.; Guidance Financial, an Islamic mortgage lender in Reston, Va.; and the Ethica Institute of Islamic Finance in the United Arab Emirates, which certifies Islamic financial institutions.

In addition to the 3-day training program held in Berkeley, Calif., the imams were given two months of free access to an online training and certification program in the fundamentals of Islamic finance, although Ethica could not say how many of the imams enrolled in the course.

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Filed by Jahnabi Barooah  |