Credit-related practices of Islamic banks in comparison with theory: case study of Turkey
Citation
Orhan Aström, Z. H. (2015). Credit-Related Practices of Islamic Banks in Comparison with Theory: Case Study of Turkey . International Journal of Islamic Economics and Finance Studies , 1 (2) , 39-60.Abstract
The aim of this paper is to analyse credit-related practices of Islamic banks in
Turkey in comparison with theory. Here, ‘credit-related practices’ are, first, the bank
balance sheet item called ‘loans’ in general, and second, loans in terms of their types.
By ‘theory’ we mean Islamic economics.
In attaining the aim of this paper, we use comparative methodology
depending on quantitative and qualitative research. In this context, we utilize
quantitative methods like collecting calculating and representing -through figures
and charts- relevant data, and qualitative methods such as searching through,
selecting, summarizing and evaluating relevant literature and documents like
agreements and reports concerning the subject.
Some of the outstanding results of this paper are as follows; loans are the
dominant use of funds for Turkish Islamic banks with changing ratios between 60-
75% for the period of December 2005-June 2015 and the main method used for
loans is murabahah with 99.7% as of June 2015. Secondly, 91% of household loans
are in the form of consumer credits as of June 2015, among which house loans are
sweepingly dominant. Credits by individual credit cards have been on the increase
until the second half of 2013.