19 September 2015
I have been writing technical articles since 1997 when I wrote my first piece for "The Treasurer", the magazine of the Association of Corporate Treasurers. In December 2005 that magazine published my first article on Islamic finance, and since then I have written very widely on the subject.
However I have never had to write a regular column until the editor of Islamic Finance News recently asked if I would like to do one. I decided to devote the first "A letter from Amin" to some background information about how I became involved in Islamic finance and why I am passionate about it.
It was published in the 9 September 2015 issue of Islamic Finance News. While the magazine is only available to subscribers, I have reproduced the text of my column below. As this is the first column I am also sharing the amusing caricature the magazine uses to illustrate my column.
While I have been writing technical articles for publication since early 1997, this is the first time I have been a columnist. The editor has asked me for one piece each month, on anything which is relevant, readable and legal. It should also be interesting, if that is not an oxymoron for the writings of a chartered accountant!
To help readers understand how I see the world, I have devoted this first column to how I came into Islamic finance.
I have been an accounting, tax and treasury expert for a long time - chartered accountant since 1977, chartered tax adviser since 1978 and a corporate treasurer since 1995. Conversely I first thought seriously about Islamic finance in 2002 when I went on Hajj. One of our group was a biochemist (PhD holder I recall) in middle management in a pharmaceuticals company. He did not own his own home because he had religious objections to a conventional mortgage. We spent many hours inconclusively debating why a fixed interest loan was impermissible but a murabaha transaction with the customer’s payments identical to those of the fixed interest loan was permissible.
I became professionally involved in 2005 when the UK changed its corporation tax and income tax laws with the goal of enabling Islamic banks to operate without the bank or the customer suffering tax costs greater than with conventional banking. Given my background, I have always concentrated on the tax, accounting and regulatory aspects of Islamic finance. From time to time people approach me seeking a religious opinion, and I always tell them I am not a religious advisor and recommend they think about the issue for themselves.
Fundamentally that is because I believe that all religious issues are for the individual Muslim to decide, since each of us is individually accountable to God. Obviously that does not preclude seeking guidance and advice from those who have studied Islam more deeply than you, but ultimately the religious decisions are yours and nobody else’s, since it is you who must answer for them.
I often remind people that, despite many years of strong growth, Islamic finance worldwide still amounts to between 0.5% and 1% of total finance, with the other 99+% being conventional, despite Muslims being about 23% of the world’s population. Leaving the reasons to one side, those statistics show that the industry has enormous scope for future growth.
I feel passionate about Islamic finance because it provides financial services to those Muslims whose religious views preclude them from purchasing conventional finance. Every occasion when a Muslim husband dies in Britain, with no life insurance but leaving an impoverished wife and young children is a reminder of why we need life takaful provision in Britain.