Rate of Return in Islamic Investment

Abstract

Islamic principles have shown how rate of return can be used to reduce confusion. The challenges that face Islamic banks today require major changes in their perception and attitude. This chapter explores the distinction between rate of return in Islamic investment and conventional investment. Although there are some similarities between Islamic and conventional approaches, the distinctiveness of Islamic finance remains. Moreover, the benefit which we can get by applied rate of return in Islamic investment is promoting Islamic finance as a new phenomenon in international investment. In a world currently dominated by Western capitalism, Islamic finance appears as a beginner, although in reality it has a rich history as a facilitator of trade and economic transactions in the past. Without doubt, Islam has contributed to and benefited from financing based on Islamic investment and the Islamic money markets.