Banking Tawarruq Organized “Tas’heel” transaction at Bahrain Islamic Bank as a model

Abstract

This paper aims to explain the treatment of tawarruq, which Islamic banks have become increasingly adopting, and to highlight how different it is from figurative fiqh tawarruq. The Islamic faith is more and more towards formulas that result in indebtedness between it and its clients without going towards investment and financing formulas that are based on the principle of profit and loss sharing.

The distinction was made in the tawarruq transaction launched by BisB under the name "Tas'heel", the main objective of which was to finance individuals and fulfill their needs represented mainly in repaying debts to banks, education expenses, medical expenses, marriage expenses,... Despite its importance, the supervisory authority The legitimacy demanded the bank not to resort to it except for necessity and for purposes that cannot be financed from other products. It also showed its importance not only in terms of financing individuals, but also in terms of moving the local market through its emphasis on buying goods from the local market, and staying away as much as possible from the international market. Many suspicions were raised around it, specifically not enabling the customer to own the commodity.