To quell the notion that the only reason for the existence of the Islamic financial industry is to satisfy the religious obligations of the Muslims of the world, we’ve compiled a quick guide taking you through the significant ways in which adhering to Islamic principles has the potential to offer strong advantages for the benefit of both Muslims and non-Muslims alike. Let’s get started!

Helps Lower Economic Inequality

There’s no denying that the conventional markets are designed to benefit the rich. Things tend to be different with Islamic markets since it promotes wealth and risk sharing. Islam doesn’t prohibit wealth accumulation. Rather, it raises awareness and responsibility for the poor. Islam’s five pillars include Zakat or charity.

The riskier an investment is, the higher the return. Only high-risk investors can afford to lose money. Paycheck-to-paycheck or low-savings people can’t afford to lose money, so they don’t invest. Most products of Islamic finance promote altruism, economic activity, and social responsibility.

Simplicity and Transparency are Encouraged

If you think Islamic financial products are simple, then you’re in it for a rude shock. In reality, a financial products’ model may be more complex due to multiple contracts and parties. Of course, it is arguable that Islamic-based products will never become as complex and hard to understand as conventional products. The reason behind they use stricter contracts.

It is important to note that Islamic financial products are based on Sharia-compliant contracts  that need to involve little to no uncertainty. They value assets. Islamic products focus on real assets rather than speculations. That doesn’t mean investors hold the assets, but they know what their money is buying.

Globally, people are searching for greater economic stability. After years of crises and economic gloom, it is obvious that many countries want positive change. While Islamic finance can’t solve every economic crisis or prevent future economic instability, the fundamental principles serve as a positive example of financial reform.

Be sure to research more about the benefits accompanying Islamic finance and how it has the potential to help change your life for the better.