Promoting education of Islamic Finance In Australia - Research Paper Example

INTRODUCTION Islamic finance is the new representation of financial s and it is said to be the answer in looking for a better and fairer way of managing money and in underpinning the real financing activities. The rules in Islamic finance are under Muslim’s law (Shariah) which is derived from the Holy Qur’an and Sunnah (Strom, et al., 2007). Islamic finance is a rapidly growing industry in the financial system considering that 20% of the world’s population is Muslim and Islam being the third largest religion.

Australia is one of the countries that capitalise its growth from Islamic banking and insurance market. This is one of the reasons why Australia is very keen in promoting Islamic finance services in the country. However, it has been proven that education is extremely important in responding to the growing interest in Islamic finance (Zubair, 2008). Thus, the main thrust of this paper is to promote education of Islamic finance in Australia. This is to provide alternative education model to attract Muslim students from all over the world; and at the same time attracting locals to a new education development in the field of finance.

PROMOTING EDUCATION OF ISLAMIC FINANCE IN AUSTRALIA The demand of Islamic financial services among Muslims in Australia is rapidly growing, and to address this concern, the country entered the Islamic finance. Muslim population in Australia is relatively high because of its long-standing trade ties and cooperation to different Muslim countries (Khaleej Times, 2010). According to the current assistant treasurer of Australia Nick Sherry (2010), “the Islamic finance, banking and insurance market [that] is worth almost $1 trillion is growing rapidly and could reach as much as $5 trillion.

” Several institutions in the country are now offering Islamic financial services like Murababa, Ijara, and Musharaka where Muslims and non-Muslims can borrow with no interest and no trading debt (Ahmad, 2010, p.38). This is in response to the local and global potential demands for Islamic finance services in the country. However, the preface of Islamic finance in Australia is relatively new and as expected, not all of the Muslims and non-Muslims fully understand the principles of Shariah and the Islamic banking concept sector.

The Islamic Financial Services Programs (IFSPs) in Australia can be well implemented if the people are fully aware on the entirety of the program and this can be done through education. Several Islamic institutes are looking forward to a day that Shariah’s standard will be recognized in the academic and training institutes. Education will elevate the financial literacy both for Muslims and non-Muslims and they will also be well-informed on the practices of IFSPs (Ahmad, 2010, p.39). Now, Australian government is “offering an AUD 25,000 post-graduate scholarship to a member of the Muslim community for the year 2007 to further understanding of Islamic banking” (Ahmad, 2010, p.38). This program is exactly the same with the Islamic finance professional certificate (IFPC) established by INCEIF in Malaysia (Oxford Business Group, 2007, p.87). This education effort signifies that the country is very dedicated in promoting Islamic finance that is why some of the international financial institutions like HSBC and Citibank are considering the country to be their banking subsidiary (Ahmad, 2010, p.40). Recently there are many students from neighboring Muslim countries like Abu Dhabi who prefer to study in Australia because the demand of education is very strong.

CONCLUSION Overall, Islamic finance is now being practiced in Muslim and non-Muslim countries. Australia has capitalised its growth from this industry that is why several institutions in the country are now offering the Islamic financial services. However, the industry is relatively new and not all of its concepts are fully understood by the people. In response, Australia is offering several educational programs like the IFSPs. This is to attract Muslim students from all over the world as well the locals to fully comprehend Islamic banking concept in the field of finance.

Reference ListsAhmad, A. U. F., 2010. Theory and practice of modern Islamic finance: the case analysis from Australia. USA: Brown Walker Press.Khaleej Times, 2010. Australia is keen to promote Islamic finance, [internet] 18 June. Available at: http://www.khaleejtimes.com/biz/inside.asp?xfile=/data/business/2010/June/business_June322.xml§ion=business[Accessed 08 October 2010].Oxford Business Group, 2010. The report: Malaysia 2007. Oxford Business Group: Malaysia.Sherry, N., 2010. Australia, Qatar and the future of Islamic finance.

In: Speech to the Qatar Chamber of Commerce and Industry. Grand Hyatt Hotel, Doha, Qatar 27 April 2010. Treasury Portfolio Ministers: Australia. Strom, S. Karasik, T. Wehrey, F., 2007. Islamic finance in a global context: opportunities and challenges. Chicago Journal of International Law, 7 (2), pp. 379+.Zubair, H., 2008. Islamic finance education at graduate level: Current position and challenges. [Online] Available at: http://mpra.ub.uni-muenchen.de/8712/1/MPRA_paper_8712.pdf [Accessed 08 October 2010].