Equitable distribution of credit may be acquired through (a) (b) (c) (d) 4. prov
ID: 2807874 • Letter: E
Question
Equitable distribution of credit may be acquired through (a) (b) (c) (d) 4. provision of small amounts of credit to micro enterprises in the informal sector promoting an equitable distribution of credit in the economy a and b none of the above 5. Sukuk holders (a) (b) (c) (d) do not share that return which was agreed at the time of issuance do not bear the loss proportion to their share in the investment are also earning the interest (riba) none of the above Process and the procedures applied for Sukuk issue are almost same as those used for securitization in the conventional set-up, with the exception of (a) avoiding Riba, Gharar and the activities prohibited by the Shari'ah (b) ownership (c) voting (d) none of the above 6. 7. Ijarah Sukuk (a) cannot be used for mobilizing funds for the development of long-term infrastructure projects can buy and sell in a secondary market must not represent ownership of the pro rata undivided parts of the asset with all related rights and obligations not representing ownership of well-defined and known assets tied up to a lease contract, rental of which is the return payable to the Sukuk holders (b) (c) (d) 8. Salam Sukuk attractive to the seller, whose cash flow is enhanced in advance (a) (b) are not are not attractive to the buyer, as the Salam price is normally lower than the prevailing spot price are certificates of equal value issued for the sake of mobilizing capital that is paid in advance in the shape of the price of the commodity to be delivered later can sell and buy in the secondary market. (c) (d) Repaying a loan in excess of the principal and without a precondition (a) is not commendable and also not compatible with Shariah (b) is commendable and compatible with the Sunnah of the holy Prophet (pbuh) (c) can be adopted as a system (d) would mean that a loan would necessarily yield a profit, which fits in the philosophy of 9. Islamic financeExplanation / Answer
The correct answer to your question will be Option (c) - Both (a) & (b). My reasons for saying that are as follows:
Distribution of Credit conventionally has been concentrated in the more formal businesses since Banks neither have the capabilities to assess the credit worthiness of the informal businesses nor have the capacities to effect recoveries therefrom. Thus, they would conventionally concentrate funds on businesses they can assess & (believe to) recover their money from.
Due to this, the informal sector, although worthy, is usually devoid of Formal credit channels. However, if all lenders were to be asked to provide a certain portion of their funds to the small informal businesses, this should allow informal businesses to tow the formal channels as well institutionalize lending to informal businesses.
Furthermore, other measures to promote more equitable distribution of credit are also desirable wherein informal businesses are allowed to come into the mainstream.
Hope that helps you out!
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