The Islamic banking industry in Algeria: Reality and Challenges: A case study of Al Baraka Bank

Abstract

Banking is considered the backbone of the economy and the reference point for the movement of capital. Islamic banking is an integral part of banking in general because it is based on the same principles and considerations as global banking. This research aims to answer logical questions about the nature of Islamic banking and its historical development through the jurisprudence of financial transactions, which serves as a guide to trade and capital movement. As Islamic banking operates under the rules of Islamic law (Sharia), this study highlights the relevant Sharia rules and regulations that underpin these transactions and distinguish them from other financial transactions. The study also outlines the objectives of this mechanism in the Islamic financial market, particularly given its emergence as an alternative to traditional financial transactions, which often contradict the provisions of Islamic law. Religious motivations and fears surrounding Sharia prohibitions in Islamic banking have led investors to hesitate in providing significant capital for banking transactions in traditional banks. Consequently, Islamic banking has become a refuge for Muslims to invest their money, offering an alternative to ineffective hoarding and saving.