An Analysis of Interest-Free Finance in Pakistan

An interest-free economy plays a prominent role in the country's development. Pakistan being an Islamic country should make efforts to flourish Islamic finance in order to get the benefits of this justified and equitable Islamic economic system. The basis of interest-free finance is avoiding interest (usury) which is against the teachings of the Quran and Sunnah. The present research is qualitative in nature, data is extracted from audited financial statements of the respective Islamic banks and websites. The global annual growth rate of interest-free finance is 10% and the same growth is exhibited by Islamic banks. Islamic banks are contributing to charity to achieve SDG goals under CSR. In Pakistan, the people believe Islamic banking is not un-Islamic. Islamic finance's challenges were also mentioned. The biggest challenges include a lack of qualified people, different schools of thought, no Islamic banking laws, no client awareness, and few Islamic products.