Once a niche banking product of the Muslim world, Islamic finance is becoming a global financial darling. Finance hubs from London to Hong Kong have expressed interest in, or initiated programmes aimed at, attracting Islamic assets and Islamic banks have stepped up, opening offices around the world. Islamic finance is becoming mainstream, even if some critics still think it is little more than a marketing gimmick.
Islamic finance began in the Middle East during the 1970s. The first Islamic banks were launched in Saudi Arabia and the United Arab Emirates. Malaysia joined the fray in 1983 with the Islamic Banking Act and the launch of the Bank Islam Malaysia.
By the mid-1990s, global Shar'iah-compliant...
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