Islamic finance model to ‘solve income inequality'

The chairman of Turkey's main stock exchange, Borsa Istanbul, said yesterday that the Islamic finance model could solve the issue of income inequality. Speaking at the International Islamic Finance Symposium in Istanbul, Talat Ulussever described the role of Islamic finance in the global economy: "Islamic finance will pave the way for creating a more prosperous and fair world for all."

Ulussever said the economic term "risk" comes from the Islamic term "rizq," which means livelihood. "So, we can understand the idea of risk sharing as 'rizq' sharing ... Islam encourages people to share their income with others through Islamic customs such as 'sadaqah' [voluntary charity] and 'zakat' [obligatory alms-giving]. All these means of sharing can reduce income inequality around the world," Ulussever said.

This is why the term "Islamic finance" should be changed to "Finance of Islam," Ulussever said. "Instead of a stock market model where only Islamic shares and sukuk - which does not earn interest - are traded, we should develop a system, a model, where all stock market-listed securities could be traded in an Islamic way," Ulussever added.

The first annual symposium on Islamic finance was organized by the World Bank Group's Global Islamic Finance Development Center, in collaboration with Borsa Istanbul, the Islamic Development Bank, the Islamic Research and Training Institute and the Guidance Financial Group.

The two-day symposium, of which Anadolu Agency (AA) is the media partner, hosted a broad range of participants from academia, policy-making circles and the private sector from both the region and world. Held under the theme "Islamic Finance: A Catalyst for Shared Prosperity," the symposium aims to foster innovation and discussion in Islamic economics and finance.