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A systematic literature review of risks in Islamic banking system: research agenda and future research directions

• Original Article
• Published: 20 December 2023
• Volume 26 , article number  3 , ( 2024 )

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• M. Kabir Hassan 1 ,
• Md Nurul Islam Sohel 2 ,
• Tonmoy Choudhury 3 &
• Mamunur Rashid   ORCID: orcid.org/0000-0002-6688-5740 4  

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This study employs a systematic review approach to examine the existing body of literature on risk management in Islamic banking. The focus of this work is to analyze published manuscripts to provide a comprehensive overview of the current state of research in this field. After conducting an extensive examination of eighty articles classified as Q1 and Q2, we have identified six prominent risk themes. These themes include stability and resilience, risk-taking behavior, credit risk, Shariah non-compliance risk, liquidity risk, and other pertinent concerns that span various disciplines. The assessment yielded four key themes pertaining to the risk management of the Islamic banking system, namely prudential regulation, environment and sustainability, cybersecurity, and risk-taking behavior. Two risk frameworks were provided based on the identified themes. The microframework encompasses internal and external risk elements that influence the bank's basic activities and risk feedback system. The macro-framework encompasses several elements that influence the risk management environment for Islamic banks (IB), including exogenous institutional factors, domestic endogenous factors, and global endogenous factors. Thematic discoveries are incorporated to identify potential avenues for future research and policy consequences.

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Riba has been at the center of mainstream debate categorizing Islamic finance from its counterpart. While many scholars identify Riba is the excessive amount of additional payment charged or given on the principal amount, for others it is the fixed or predetermined amount of payment on the top of the principal amount. However, the consensus among Islamic scholars forwards the notion that Riba in any form is prohibited in Islam.

Mudarabah is a partnership-based Islamic finance contract between two parties, one party supplying the finance ( rabbulmal ), while the other party gets involved with their physical labor and skills ( mudarib ), granting each party a share of the income at predetermined ratio.

Musharakah is another classical partnership contract in Islamic banking where more than one party contributes in financing a shared company. The contract involves both parties agreeing on sharing profit on an agreed-upon ratio and sharing losses on ratio of equity capital financed.

Operational risk is the potential loss due to inefficient internal processing, system and people, and external factors such as the limited legal support and uncontrollable compliance issues (Čihák & Hesse 2010 ).

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Hassan, M.K., Sohel, M.N.I., Choudhury, T. et al. A systematic literature review of risks in Islamic banking system: research agenda and future research directions. Risk Manag 26 , 3 (2024). https://doi.org/10.1057/s41283-023-00135-z

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Fintech strategies of islamic banks: a global empirical analysis.

1. Introduction

2. digital transformation in the making, 3. data and methodology, 5. discussions and conclusions, author contributions, institutional review board statement, informed consent statement, data availability statement, conflicts of interest.

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Aysan, A.F.; Belatik, A.; Unal, I.M.; Ettaai, R. Fintech Strategies of Islamic Banks: A Global Empirical Analysis. FinTech 2022 , 1 , 206-215. https://doi.org/10.3390/fintech1020016

Aysan AF, Belatik A, Unal IM, Ettaai R. Fintech Strategies of Islamic Banks: A Global Empirical Analysis. FinTech . 2022; 1(2):206-215. https://doi.org/10.3390/fintech1020016

Aysan, Ahmet Faruk, Abdelilah Belatik, Ibrahim Musa Unal, and Rachid Ettaai. 2022. "Fintech Strategies of Islamic Banks: A Global Empirical Analysis" FinTech 1, no. 2: 206-215. https://doi.org/10.3390/fintech1020016

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Although still a small share of global finance, Islamic finance has grown rapidly over the past decade and is projected to continue to expand. The growth of Islamic finance presents opportunities to improve access to finance for the large underserved Muslim populations, and for small- and medium-sized enterprises, opportunities to facilitate investment in public infrastructures and to promote financial stability. However, for the potential to be realized and to safeguard financial stability, a number of challenges will need to be addressed. In their IMF Staff Discussion Note (SDN 15/05), entitled “Islamic Finance: Opportunities, Challenges and Policy Implications,” the authors discuss the macroeconomic and financial stability implications of Islamic finance and the policy options. This article provides brief answers to seven commonly asked questions about Islamic finance, drawing on the findings of recently completed analytical work .

• Question 1. What is Islamic finance and why does it matter?

Islamic Finance refers to the provision of financial services in accordance with Shari’ah Islamic law, principles, and rules. The main tenets of Shari’ah as applied to finance are: the prohibition of interest; excessive uncertainty and gambling; risk sharing; the requirement that finance supports real economic activities; and the adherence to ethical standards.

The Islamic finance industry mainly comprises banking and the Sukuk or Islamic bond market which account for 80 percent and 15 percent of total Islamic financial assets, respectively. The balance is accounted for by equities, investment funds, insurance (Takaful), and microfinance. Islamic finance is growing rapidly in terms of assets and geographical reach, although the assets are concentrated in Southeast Asia and the Middle East, particularly the Gulf Cooperation Countries (GCC). The Islamic banking sector is now systemically important in a dozen countries and Sukuk is increasing its global reach to include issuers from advanced, emerging, and developing economies ( Figure 1 ).

Overview of Trends in the Islamic Finance Industry

Citation: IMF Research Bulletin 2015, 002; 10.5089/9781513500041.026.A003

The growth of the Islamic finance industry offers important potential benefits. It can facilitate financial inclusion by increasing access to banking services to underserved Muslim populations; the risk-sharing characteristics of Islamic financial products can facilitate access to finance by small- and medium-sized enterprises (SMEs); and the asset-backed nature of Sukuk makes them suitable for infrastructure financing that can help spur economic development, including creating an enabling environment for private sector investment. Moreover, the requirement to finance real economic activity can reduce leverage while the risk-sharing features enhance the loss absorbency of capital.

However, to realize the potential and to safeguard financial stability, countries need to adapt their regulatory, supervisory, and consumer protection frameworks to the specificities of Islamic finance; to develop Shari’ah-compliant financial markets and monetary instruments; and to build an enabling environment for Sukuk market development.

• Question 2. What stability risks are unique to Islamic banking and what changes are needed to regulatory frameworks to safeguard financial stability?

Islamic financial transactions are structured differently from conventional products because of the need to comply with Shari’ah principles. Unlike conventional banks, Islamic banks are funded by current accounts that do not attract interest or by profit-sharing investment accounts (PSIA) where the investment account holder (IAH) receives a return that is determined, after the fact, by the profitability of the underlying financing and the IAH bears losses, if any. On the assets side, transactions include sales with a profit markup and deferred payments, leases, partnerships, or joint ventures. Additionally, to facilitate the investments, Islamic banks are permitted in some jurisdictions to establish subsidiaries of non-financial corporations in their groups, resulting in conglomerate corporate structures.

Consequently, in addition to standard banking risks (such as credit, market, liquidity, and operational risks), Islamic banks also face unique risks such as the displaced commercial risk (DCR) whereby shareholders may forego a part of their profits to provide competitive earnings to IAHs, equity investment risk stemming from partnership-like financing, rate of return risk in a context of dual systems where lower earnings may lead to customer flight, and Shari’ah compliance risk. Other standard banking risks such as operational, group risks, concentration, and liquidity risks could also be more heightened because of the complexity of some contracts; corporate structures that include a myriad of non-financial corporations; and underdeveloped liquidity infrastructure and safety nets. PSIAs also raise unique consumer protection issues because of inadequacies in disclosures and the asymmetric treatment of PSIA as investors without shareholder rights.

Therefore, to safeguard financial stability, there is need for further regulatory clarity and consistency, through greater adoption of Islamic standards developed by Islamic standard setting bodies. Countries with Islamic banks need to adopt a cross sectional approach to supervision of Islamic banks, avoid treating profit-sharing investment accounts as pure deposits while enhancing disclosures and corporate governance for the PSIA, strengthen Shari’ah governance structures, and build supervisory capacity. There is also a need to develop supporting financial infrastructures, including Shari’ah-compliant financial safety nets and appropriate resolution frameworks.

• Question 3: How does Islamic banking affect monetary policy conduct given the prohibition on interest and what reforms are needed?

Monetary policy formulation and implementation are challenging in the presence of Islamic finance because of the scarcity of Shari’ah-compliant monetary policy instruments, the under development of money and interbank markets, and inadequate understanding of the monetary transmission mechanism. Shari’ah-compliant central bank facilities are also limited, reflecting the difficulty in designing market-based instruments for monetary control and limited Sukuk issuance. The shortage of Shari’ah-compliant high-quality liquid assets (HQLA) also reduces the collateral available for liquidity management and may also affect the smooth functioning of the payment systems. Therefore, a key priority will be to bolster the supply of Sukuk and develop Shari’ah-compliant monetary policy instruments.

• Question 4. What needs to be done to deepen the Sukuk market?

Although the Sukuk market has registered rapid growth in value and the issuer base has broadened, the markets for Sukuk are still neither deep nor liquid, and most issues of Sukuk are asset based and not asset backed. Issuance also takes place without a comprehensive strategy to develop the domestic market.

National authorities should, therefore, develop the necessary infrastructure, including developing securitization and trust laws, promoting true securitization, clarify legally the investor’s rights—particularly in defaults—and promote standardization of contracts. Regular sovereign issuance, and at different maturities, is critical for deepening the market and establishing a yield (or Sukuk) curve that could provide a benchmark for corporate Sukuk. Increased sovereign issuance should also be underpinned by sound public financial management (PFM), and attention should be given to the accounting and statistical treatment of Sukuk instruments, which are currently largely overlooked in existing international standards.

• Question 5. What are the tax implications of the growth of Islamic finance?

Islamic finance raises a number of taxation issues that call for policy attention at both national and international levels. The favorable treatment of debt in most tax systems relative to equity can disadvantage Islamic finance. Secondly, Islamic finance involves a series of transactions that could attract value-added, stamp, and other sales taxes that could put Islamic finance at a disadvantage relative to conventional finance. Therefore, particular attention is needed to ensure that tax systems guarantee a level playing field and that the system does not create incentives for international regulatory arbitrage.

• Question 6: Does Islamic finance require changes to macroprudential policies?

Most macroprudential policies are applicable to Islamic banks with some modifications. The countercyclical capital buffer framework, conservation buffers, leverage ratio, dynamic provisioning, and sectoral risk weights could help in mitigating credit risks. Also, profit equalization reserves (PER) and investment risk reserve (IRR) can serve as countercyclical reserve buffers. However, given the business model that includes investment, modifications are needed to risk metric and stress tests for identifying and monitoring risks. Sectoral concentrations and liquidity risks also deserve greater attention because of the requirement to underpin all transactions with real economic activity and also the underdeveloped nature of Shari’ah-compliant financial markets and safety nets.

• Question 7. What has prompted the IMF to focus on Islamic finance and what is the agenda going forward?

The IMF’s interest in Islamic finance is not new. In the early 1980s, the IMF initiated a program of research on the theoretical underpinnings of an Islamic financial system, the operations of Islamic banking, and the conduct of monetary policy within an Islamic system. The IMF also played a key role in the establishment of the Islamic Financial Services Board in 2002. Where relevant, the IMF has been providing policy advice (Article IV consultations and its FSAP assessment) and technical assistance (TA) to strengthen the regulatory framework and monetary operations and to develop the Sukuk market.

However, with the growth of the industry, demands from member countries for policy advice and technical assistance have increased and the evolution of and innovations in the industry also present new opportunities and challenges. So to ensure coherence and consistency in our policy advice, the IMF formed an interdepartmental working group on Islamic finance to undertake analytical work on the macroeconomic and financial stability implications of Islamic finance. The IMF also established an external advisory group which helped to identify policy challenges facing the Islamic finance industry and facilitated coordination with those international institutions involved in establishing standards for the industry. The findings are summarized in the Staff Discussion Note (SDN 15/05) issued on April 6, 2015, entitled “Islamic Finance: Opportunities, Challenges, and Policy Options.”

To foster policy dialogue on issues raised in the SDN, the IMF and the G20 presidency jointly organized a seminar on Islamic finance during the 2015 IMF-World Bank Spring Meetings entitled “Islamic Finance: Unlocking Its Potential and Supporting Stability.” The seminar was a kickoff event for a global conference on Islamic Finance that will be held in November 2015 in Kuwait. In the interim, a series of working papers that underpinned our policy conclusions will be published and consolidated into a book. The IMF will also continue regular policy dialogue with our member countries, our financial stability assessments, our technical assistance, and training.

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Handbook of Islamic Banking (a review)

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The recent attention that Islamic finance has received in the news media—for reasons that include its rapid growth—has led to the publication of numerous books on the subject. Nevertheless, there is neither a standard textbook on Islamic finance nor a book that provides the relevance, comprehensiveness, and rigor that generalists in the finance profession might reasonably expect.

In the Handbook of Islamic Banking , M. Kabir Hassan, a professor of economics and finance, and Mervyn K. Lewis, a professor of banking and finance, have assembled 25 articles on various aspects of Islamic finance written by some of the leading authorities in the field. (Considering that the articles cover more than banking, the book’s title is somewhat misleading.) Most of the authors of the articles in this book are academics, and some have published extensively on the subject. Spanning areas such as banking, capital markets, and Takaful (Islamic insurance), the Handbook of Islamic Banking traces Islamic finance from its foundations to current practice. Although the book is fairly comprehensive, it does not directly address Islamic private wealth. The articles offer intellectually stimulating analysis to finance professionals at the intermediate or advanced level.

The book’s five parts, each containing four to six articles, address the following topics: (1) foundations of Islamic finance, (2) operations of Islamic banks, (3) markets and instruments, (4) Islamic banks and development, and (5) globalization of Islamic finance.

A recurring theme in the book is the adaptation of Shari’a (Islamic religious law) to modern financial practices. For example, Lewis notes that although Hinduism, Judaism, Christianity, and Islam all opposed usury in the past, Islam remains the only major religion to prohibit the charging of interest. Pointing out similarities between modern Islamic financial practices and techniques used to circumvent the Roman Catholic Church’s opposition to usury in medieval times, Lewis questions whether Islam can sustain its ban.

Habib Ahmed and his colleagues examine the nature of risks (e.g., credit risk, market risk, liquidity risk, and operational risk) in Islamic banks and the unconventional means by which they are managed. These devices, which include parallel contracts, have arisen because certain conventional risk management tools (e.g., credit derivatives) are prohibited by Shari’a. Mohammed Obaidullah explains how securitization could be achieved without involving riba (which includes conventional bank interest) and explores the issues surrounding the compliance of underlying structures with Shari’a.

Said M. Elfakhani and his coauthors explain the governance, marketing, and distribution of Islamic funds. They state that the risk-adjusted performance of Islamic funds does not differ significantly from that of conventional funds. Volker Nienhau discusses the sensitive issue of conflicts of interest facing the religious scholars who serve on corporate Shari’a supervisory boards. He offers the establishment of independent, national boards as a possible solution.

Finally, M. Umer Chapra asserts that justice is one of the primary objectives of Islam and, therefore, of Islamic finance. He argues that in a financial context, justice requires risk/reward sharing and equitable distribution of credit. According to Chapra, however, progress on both counts has not been significant.

Neither glorifying nor disparaging Islamic finance, all the articles give a balanced perspective. Each article includes references for additional readings on the subject. A brief glossary makes finding the meanings of unfamiliar Arabic terms easy.

Not all the contributions are equally insightful or relevant for finance professionals. Some chapters—for example, “Incentive Compatibility of Islamic Financing” and “Operational Efficiency and Performance of Islamic Banks”—have limited appeal. Another disadvantage of the  Handbook of Islamic Banking is that it was published in 2007, and thus, some of its data have already become outdated in a rapidly evolving market. Finally, the book’s most obvious drawback is its price.

Taking into account all its strengths and weaknesses, the Handbook of Islamic Banking  is one of the best books available to finance professionals who seek an intermediate or advanced text on various aspects of Islamic finance.

—U.H.

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Introduction

Islamic finance is a means of finance followed and undertaken by financial corporations (banks and lending institutions) in the Muslim world and Islamic companies operating in the Western world.

Islamic finance helps these companies raise finance following the Sharia law, also known as Islamic law. Islamic finance also refers to the different types of investments that are allowed under Sharia or Islamic law.

Islamic law outlines certain rules and regulations that need to be followed. One main rule of understanding Islamic banking and finance is avoiding interest (also known as riba). Since Islamic law views interest payments as favouring the lender, who is charging interest at the borrower’s expense, these payments are considered haram (prohibited) under the Islamic law of finance.

In contrast to the traditional banking method, Islamic finance and Islamic banking work with the sole purpose of contributing to the socio-economic goals of the society by placing its focus on profit-sharing schemes.

Profit banking, under which the financial institution shares its profits and losses, is considered halal (permissible) under Islamic finance law.

On the other hand, traditional banking is based on profits through halal or haram means of doing business, which is why this form of banking is discouraged under Islamic rules and teachings.

Considering Islamic Finance as a burgeoning field, this topic must be studied in-depth. Here are five dissertation topics on Islamic finance that will help understand the subject comprehensively:

These topics have been developed by PhD qualified writers of our team , so you can trust to use these topics for drafting your dissertation.

You may also want to start your dissertation by requesting  a brief research proposal  from our writers on any of these topics, which includes an  introduction  to the topic,  research question ,  aim and objectives ,  literature review  along with the proposed  methodology  of research to be conducted.  Let us know  if you need any help in getting started.

Check our  dissertation examples  to get an idea of  how to structure your dissertation .

Review the full list of  dissertation topics for 2022 here.

2022 Dissertation Topics on Islamic Finance

Topic 1: the role of islamic finance in financial inclusion among young working adults in the uk.

Research Aim: This research aims to find the role of Islamic finance in financial inclusion among young working adults in the UK. It will find how Islamic finance, through various aspects such as Islamic banking, investments, lending, etc., attract young working individuals to become a part of the UK financial system. Moreover, it will analyze how such as marketing, etc. Islamic financial institutions make Islamic finance more accessible and easier to manage for the young working individuals from various fields of life in the UK.

Topic 2: COVID-19 and Islamic Finance: Impact of COVID-19 on the Growth of Islamic Banking in Indonesia

Research Aim: This study will assess the impact of COVID-19 on the growth of Islamic banking in Indonesia. It will analyze the effects of COVID-19 on various Islamic banking operations in Indonesia. It will also show what strategies Islamic banks used to curb the aftereffects of COVID-19. Moreover, it will analyze its impact on profits, the number of accounts opened, lending, investments, etc., to show how did COVID-19 affect Islamic banking growth in Indonesia.

Topic 3: Islamic vs. Conventional Finance: A Study to Find the Impact of Islamic and Conventional Instruments on the Financial Sector Stability in Pakistan

Research Aim: This research intends to find the impact of Islamic and conventional instruments (bonds, investments, mortgages, etc.) on the financial sector stability in Pakistan. It will review how Islamic and conventional instruments operates in Pakistan and the difference in demands for both instruments among various individuals. Moreover, it will show how it affects the overall financial sector in Pakistan and the overall economy through investment, mortgages, lending, employment generation, banking sector growth, and financial inclusion.

Topic 4: Islamic vs. Conventional Bonds, which Absorb Global Economic Shocks Better? A Case of Sukuk vs. Conventional International Bonds during COVID-19

Research Aim: This study compares Islamic and conventional bonds to absorbing global economic shocks such as high inflation, high oil and gas prices, global economic uncertainty, global pandemics, supply chain disruptions, etc. It will compare how the performance of Islamic and conventional bonds varies with the global financial situation. It will use COVID-19 as a case study of how it affected the returns on Islamic vs. conventional bonds. Moreover, it will show how global economic and political power affects these bonds.

Topic 5: Is Islamic Finance Acceptable in Wall Street? The Role Played by Islamic Financial Companies in the US Financial Sector

Research Aim: This research sheds light on the role played by Islamic financial companies in the US financial sector. It will find how Islamic companies are listed on the New York stock exchange (NYSE) and other major exchanges in the US? How do these companies raise capital in the US? What is their financial performance as compared to their non-Islamic counterparts? Moreover, it will determine whether these companies have significant contributions to the US economy or are still outcasts?

Covid-19 Islamic Finance Research Topics

Topic 1: impact of coronavirus on islamic finance.

Research Aim: This study will address the impact of Coronavirus on Islamic finance.

Topic 2: The role of Islamic finance during COVID-19

Research Aim: This study will address the contribution and implications of Islamic finance during COVID-19.

Topic 3: Global Islamic banking and COVID-19

Research Aim: This study will focus on the situation of global Islamic banking, including the challenges and measures to overcome those challenges during COVID-19.

Islamic Finance Research Topics 2021

Topic 1: international conference on islamic finance 2021.

Research Aim: This research aims to conduct an in-depth study of the international conference on Islamic finance 2021.

Topic 2: Entrepreneurship in Islam- a literature review

Research Aim: This research aims to identify the role of entrepreneurship in Islam and conduct a literature review to draw evidence-based conclusions.

Topic 3: Customers satisfaction with Islamic banking

Research Aim: This research aims to evaluate the customer’s satisfaction with Islamic banking

Topic 4: Concept of profitability in Islamic Vs. Conventional banks

Research Aim: This research aims to conduct a comparative study on the concept of profitability in Islamic and Conventional banks.

Evaluating the Islamic Types of Investments – Which One is the Most Profitable?

Research Aim: Islamic finance is a vast field. To understand how it works and what opportunities it presents, we must understand its offers. Among the different types of Islamic finances available, the various sources of Islamic funds, etc. There are different types of Islamic investment opportunities one can invest in.

As a religion, Islam does not allow interest earned on any investment. This study will be an exciting one. The thesis will discuss all the available types of Islamic investments and the type of returns they offer.

Each investment instrument will be evaluated based on what it offers and how people can earn a return on their investments. This research will be based on statistics and qualitative data and discuss which type of investment could be the most profitable.

Understanding the Fundamentals of Islamic Finance and How it Works

Research Aim: Islamic finance is an exciting field. The more you learn about it, the more curious you become about how it operates, what rules and standards it follows, and what returns the system offers.

This research will explore the basics of Islamic finance, i.e. how the system was developed, its guiding principles, and the rules and regulations set. Most importantly, the research will cite examples from the Holy Quran and include fatwas from renowned Muslim scholars regarding investment and finance.

The thesis will prove a stepping stone for researchers looking to learn Islamic finance and how it should be implemented for the best outcome for the borrower and the investor.

How Can ResearchProspect Help?

ResearchProspect writers can send several custom topic ideas to your email address. Once you have chosen a topic that suits your needs and interests, you can order for our dissertation outline service which will include a brief introduction to the topic, research questions , literature review , methodology , expected results , and conclusion . The dissertation outline will enable you to review the quality of our work before placing the order for our full dissertation writing service !

Comparative Study of Traditional and Islamic Finance

Research Aim: Traditional banking is something that everyone is aware of. From basic accounts to loans and investment opportunities, banks offer their customers all sorts of money-making opportunities. However, they charge interest on loans and offer interest payments to account holders and different investment schemes.

This is exactly the opposite of what Islamic banking offers. Islamic finance and banks run on a basic rule of profit and loss sharing. If the bank or financial institution earns profits, they are shared according to a certain fixed percentage. In cases where the institutions suffer losses, the same is shared/deducted from investors’ earnings.

This thesis will focus on the main difference between the two types of banking, focusing on investment instruments, etc. The research will then conclude which banking is favourable for society and how people can gain more.

Islamic Finance and Economic Development: How Does Islamic Finance Law Contribute?

Research Aim: Many Islamic finance proponents argue that Islamic Finance helps people earn more in the right manner. Still, it also helps them build a society and contribute to the well-being of people.

This study will discuss how finance and banking help individuals borrow and lend and how Islamic finance contributes to societies’ economic development.

The thesis will conclude by suggesting new and innovative ways for the banking and finance industry to help people struggling with finances and assist the economy by offering friendly investment opportunities and loans.

How Interest-Free is Islamic Interest-Free Banking?

Research Aim: Islamic finance is usually considered a system that does not directly benefit the people. Many experts believe that Islamic finance is interest-free only on the surface but applies interest as ‘hidden charges’ or renames the term ‘interest.’

While this holds for a few financial institutions, the bigger picture might be a little different. Islamic finance is interest-free and can run successfully if appropriately and implemented accurately, as many Islamic researchers claimed.

This research will provide an in-depth analysis of how successful Islamic finance has been, how it works interest-free, and how people benefit from it. The research will also negate notions of Islamic finance, i.e. the system is not interest-free. Moreover, the thesis will investigate how the system works concerning Islamic teachings and how people benefit from them.

Important Notes:

As a student of Islamic finance looking to get good grades, it is essential to develop new ideas and experiment on existing Islamic finance theories – i.e., to add value and interest in your research topic.

Islamic finance is vast and interrelated to many other academic disciplines like finance, management , and project management . That is why it is imperative to create an Islamic finance dissertation topic that is particular, sound, and actually solves a practical problem that may be rampant in the field.

We can’t stress how important it is to develop a logical research topic based on your entire research. There are several significant downfalls to getting your topic wrong; your supervisor may not be interested in working on it, the topic has no academic creditability, the research may not make logical sense, and there is a possibility that the study is not viable.

This impacts your time and efforts in writing your dissertation , as you may end up in the cycle of rejection at the initial stage of the dissertation. That is why we recommend reviewing existing research to develop a topic, taking advice from your supervisor, and even asking for help in this particular stage of your dissertation.

While developing a research topic, keeping our advice in mind will allow you to pick one of the best Islamic finance dissertation topics that fulfil your requirement of writing a research paper and add to the body of knowledge.

Therefore, it is recommended that when finalizing your dissertation topic, you read recently published literature to identify gaps in the research that you may help fill.

Remember- dissertation topics need to be unique, solve an identified problem, be logical, and be practically implemented. Please look at some of our sample Islamic finance dissertation topics to get an idea for your own dissertation.

How to Structure your Islamic Finance Dissertation

A well-structured dissertation can help students to achieve a high overall academic grade.

• A Title Page
• Acknowledgements
• Declaration
• Abstract: A summary of the research completed
• Table of Contents
• Introduction: This chapter includes the project rationale, research background, key research aims and objectives, and the research problems. An outline of the structure of a dissertation can also be added to this chapter.
• Literature Review : This chapter presents relevant theories and frameworks by analysing published and unpublished literature on the chosen research topic to address research questions . The purpose is to highlight and discuss the selected research area’s relative weaknesses and strengths whilst identifying any research gaps. Break down the topic and key terms that can positively impact your dissertation and your tutor.
• Methodology : The data collection and analysis methods and techniques employed by the researcher are presented in the Methodology chapter, which usually includes research design , research philosophy, research limitations, code of conduct, ethical consideration, data collection methods, and data analysis strategy .
• Findings and Analysis : Findings of the research are analysed in detail under the Findings and Analysis chapter. All key findings/results are outlined in this chapter without interpreting the data or drawing any conclusions. It can be useful to include graphs, charts, and tables in this chapter to identify meaningful trends and relationships.
• Discussion and Conclusion : The researcher presents his interpretation of results in this chapter and states whether the research hypothesis has been verified or not. An essential aspect of this section of the paper is to link the results and evidence from the literature. Recommendations with regards to implications of the findings and directions for the future may also be provided. Finally, a summary of the overall research, along with final judgments, opinions, and comments, must be included in the form of suggestions for improvement.
• References : This should be completed following your University’s requirements
• Bibliography
• Appendices : Any additional information, diagrams, and graphs used to complete the dissertation but not part of the dissertation should be included in the Appendices chapter. Essentially, the purpose is to expand the information/data.

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• Select a topic aligning with your passion and career goals.

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Research Topics in Islamic Banking and Finance

1   How Islamic financial instruments can be used in international trade?

2   A mechanism for inter-bank transactions for Islamic and conventional banks

3  Can Sharia board play a role in the development of Islamic instruments?

4 Tawarruq as a tool of inter-bank borrowing

5  Risk management framework for Islamic banks: do we need something special?

6  Have the challenges faced by Islamic banks changed over the last decade?

7  The dynamics of financial crisis: Conventional vs Islamic finance

8  Can Zakat be used as a microfinancing tools?

9  Value at Risk of Sukuk and conventional bonds

10  Risk analysis of Murabaha financing and leasing

11  What customers say about Islamic banking? Values vs religious perspectives

12  Can ownership structure affect earning management?

13 Collaborative Islamic Banking Service: The Case of Ijarah

14 Success factors of collaboration in Islamic banks

15 Constraints in the application of partnerships in Islamic banks

16  Can Islamic finance reduce nonperforming loans?

17  Which firms use Islamic financing?

18  Can SME’s benefit more from Islamic financing?

19  Islamic banking development and access to credit

20  Islamic finance and economic growth

10 Comments

please provide me islaic finance and economic growth

What is the Role of Finance in an under developed country?

suggest an easy topic of finance for research for beginners.

What is the effect of Islamic Finance on Pakistan Economy? Please give me suggestion about the topic.

How islamic financial instruments can be use in intrnational trade

i am also need this one

can i get related cases to use as a case study in Islamic banking research topis

Assalamualaikum. pleases i need a research topic in islamic finance or islamic economy

pleases i need a research topic in islamic finance

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• The Religious Composition of the World’s Migrants

4. Muslim migrants around the world

Table of contents.

• Asia and the Pacific
• Latin America and the Caribbean
• Middle East and North Africa
• North America
• Sub-Saharan Africa
• Distance traveled by migrants
• Growth of migrants among each religious group, 1990-2020
• Regional patterns over time
• Destinations
• Country pairs
• Change since 1990
• Spotlight on Europe
• Spotlight on the Gulf Cooperation Council countries
• Spotlight on India
• Spotlight on the United States
• Acknowledgments
• UN migrant estimates
• Pew Research Center religious composition estimates
• Estimating religious compositions when no census or survey data is available
• Religious compositions of overall populations
• Study period
• Distance analysis
• ‘Faith on the Move’
• Asia-Pacific
• Latin America-Caribbean
• Middle East-North Africa
• Appendix B: Sources for the religious distribution of migrants, by destination country

The United Nations counts international migrants as people of any age who live outside their country (or in some cases, territory) of birth – regardless of their motives for migrating, their length of residence or their legal status.

In addition to naturalized citizens and permanent residents, the UN’s international migrant numbers include asylum-seekers and refugees, as well as people without official residence documents. The UN also includes some people who live in a country temporarily – like some students and guest workers – but it does not include short-term visitors like tourists, nor does it typically include military forces deployed abroad. 

For brevity, this report refers to international migrants simply as migrants. Occasionally, we use the term immigrants to differentiate migrants living in a destination country from emigrants who have left an origin country . Every person who is living outside of his or her country of birth is all three – a migrant, an immigrant and an emigrant.

The analysis in this report focuses on existing stocks of international migrants – all people who now live outside their birth country, no matter when they left. We do not estimate migration flows – how many people move across borders in any single year.

Roughly 80 million international migrants are Muslim, representing 29% of all people living outside their country of birth. By comparison, Muslims were about 25% of the world’s total population in 2020, making Muslim identity a little more common among migrants than in the overall population. 14

Muslims have moved shorter distances on average (1,700 miles) than migrants from other major religious groups, staying closer to their countries of origin. For example, large numbers of Muslims from Syria have sought refuge in nearby Turkey and Lebanon.

Muslim migrants most commonly live in the Middle East-North Africa region, which hosts 40% of them, and in the Asia-Pacific region (24%). Two-in-ten Muslim migrants live in Europe, and one-in-ten are in sub-Saharan Africa. Only 6% of all Muslim migrants now reside in North America, and even fewer live in Latin America and the Caribbean.

As of 2020, almost half of the world’s stock of Muslim migrants was born in Asia and the Pacific, the most common region of origin for Muslims who have left their country of birth. About a third of today’s Muslim migrants were born in the Middle East and North Africa, and 13% are from sub-Saharan Africa. Smaller percentages of Muslim migrants originated in Europe (6%), North America or the Latin America-Caribbean region (less than 0.5% each).

Muslims most commonly move to countries that are wealthy, predominantly Muslim, or both.

They have migrated to many different regions: Four of Muslims’ top 10 destinations are in the Middle East and North Africa, two are in Europe, three are in Asia and the Pacific, and one (the United States) is in North America.

Saudi Arabia, the birthplace of Islam, is the most common destination country for Muslim migrants by a wide margin, with an estimated 13% of all Muslim migrants (10.8 million) living there.

The Saudi kingdom also is the third-most common destination for migrants overall – roughly four-in-ten Saudi residents are foreign born. The vast majority of migrants to Saudi Arabia are Muslim (80%), as is Saudi Arabia’s overall population (93%).

The United Arab Emirates hosts over 6 million foreign-born Muslims, making it the second-most popular destination for Muslim migrants. Like Saudi Arabia, the UAE is a wealthy Muslim nation with a strong demand for foreign labor. International migrants overall make up the vast majority of the UAE’s population (94%). Muslim migrants in Saudia Arabia and the UAE most frequently come from India.

Turkey is the third-most common destination for Muslim migrants (5.9 million) as of 2020. Turkey has been economically better off than many of its neighbors and has absorbed a large number of asylum-seekers since the Syrian civil war began in 2011. Mostly due to this influx, there were about six times as many Muslim migrants living in Turkey in 2020 as there had been a decade earlier.

The next most popular destinations for Muslim migrants are Germany and the U.S.

Like migrants as a whole – who gravitate to places that offer safety and better economic conditions – Muslim migrants often leave their birth countries to escape poverty and danger. 

The most common country of origin for Muslim migrants is Syria, where a war broke out in 2011. Fully 10% of the world’s stock of Muslim migrants (8.1 million) were born in Syria. Most have migrated to countries nearby, like Turkey and Lebanon, while some have gone as far as Europe and the U.S.

India is the second-most common country of origin among Muslim migrants, with 6.0 million living there. They are much more likely than people in the country’s Hindu majority to emigrate. Although India’s population is only 15% Muslim, an estimated 33% of all India-born migrants are Muslim.

Most Muslim migrants from India live in Muslim-majority countries with job opportunities, including the UAE (1.8 million), Saudi Arabia (1.3 million) and Oman (720,000).

Afghanistan is the third-most common origin country for Muslim migrants (5.5 million). A majority of Muslim migrants from Afghanistan live in neighboring Iran (2.7 million) or Pakistan (1.6 million). Migrants from Afghanistan have fled challenging conditions over the decades, including an occupation by the Soviet Union in the 1980s and a U.S.-led invasion in the early 2000s.

The most common pair of origin and destination countries for Muslim migrants is Syria to Turkey. About 3.9 million Syrian Muslims, including many war refugees, now live in Turkey.

The next most common routes for Muslims have been Afghanistan to Iran (2.7 million), and the Palestinian territories to Jordan (2.2 million). 15

The Muslim migrant population grew from 40 million in 1990 to 80 million in 2020 (up 102%), outpacing overall migrant growth (up 83%).

Saudi Arabia, the UAE and Turkey have seen the biggest jumps since 1990, with 16.8 million additional Muslim migrants in those three countries alone as of 2020 (a 278% rise). Saudi Arabia and the UAE have had booming economies over these years, while Turkey has seen increased migration primarily from Syria.

Elsewhere, the Muslim migrant population has declined. The number of Muslim migrants living in Pakistan dropped from 4.1 million in 1990 to 2.1 million in 2020 (a 50% drop), partly reflecting the return of Afghan migrants to their home country. During the same three decades, Iran’s population of foreign-born Muslims declined from 4.3 million to 2.8 million (down 35%).

Of all origin countries, Syria accounted for the biggest surge in Muslim migrants by far, from 570,000 in 1990 to 8.1 million in 2020, a rise of about 1,300%.

India and Pakistan also have seen sharp increases, as more and more Muslim migrants have left South Asia for work in the Persian Gulf. The worldwide stock of Muslim migrants from India grew from 2.1 million to 6 million (up 192%), while the number from Pakistan rose from 1.8 million to 5.3 million (up 202%).

The largest decrease by origin came from Afghanistan, which was the birth country of 7.4 million Muslim migrants living elsewhere in 1990, compared with 5.5 million in 2020 (down 26%). This difference reflects return migration to Afghanistan as well as the gradual death of a generation of Afghans who left their country during the Soviet occupation.

Refer to our “ Geographic spotlights ” section for an in-depth analysis of migration in the GCC countries.

• This report presents interim estimates of the overall population in each religious group (including migrants and nonmigrants) using data from three Pew Research Center studies: “ The Future of World Religions ” (projections of religious composition to the year 2020 published in 2015), “ Modeling the Future of Religion in America ” (2022) and “ Measuring Religion in China ” (2023). In the future, the Center will produce new estimates of the overall size of religious groups in 2020, based on data sources that have become available in recent years. Read the Methodology for details. ↩
• The United Nations includes in this count migrants who were born in the Palestinian territories as well as their descendants, some of whom were born in refugee camps in Jordan, Syria and Lebanon . ↩

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Religious composition of the world’s migrants, 1990-2020

The future of world religions: population growth projections, 2010-2050, modeling the future of religion in america, faith on the move – the religious affiliation of international migrants, measuring religion in china, most popular, report materials.

• Interactive table: Religious composition of the world’s migrants, 1990-2020
• Dataset: Religious composition of the world’s migrants, 1990-2020

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Mining the microbiome: Uncovering new antibiotics inside the human gut

Could we fight drug-resistant bacteria with antibiotics from our intestines.

The average human gut contains roughly 100 trillion microbes, many of which are constantly competing for limited resources. "It's such a harsh environment," says César de la Fuente, Presidential Assistant Professor in Bioengineering and in Chemical and Biomolecular Engineering within the School of Engineering and Applied Science, in Psychiatry and Microbiology within the Perelman School of Medicine, and in Chemistry within the School of Arts & Sciences. "You have all these bacteria coexisting, but also fighting each other. Such an environment may foster innovation."

In that conflict, de la Fuente's lab sees potential for new antibiotics, which may one day contribute to humanity's own defensive stockpile against drug-resistant bacteria. After all, if the bacteria in the human gut have to develop new tools in the fight against one another to survive, why not use their own weapons against them?

In a new paper in Cell , the labs of de la Fuente and Ami S. Bhatt, Professor in Medicine (Hematology) and Genetics at Stanford, surveyed the gut microbiomes of nearly 2,000 people, discovering dozens of potential new antibiotics. "We think of biology as an information source," says de la Fuente. "Everything is just code. And if we can come up with algorithms that can sort through that code, we can dramatically accelerate antibiotic discovery."

In recent years, de la Fuente's lab has made headlines for finding antibiotic candidates everywhere from the genetic information of extinct creatures like Neanderthals and wooly mammoths to masses of bacteria whose genetic material the lab analyzed using artificial intelligence. "One of our primary goals is to mine the world's biological information as a source of antibiotics and other useful molecules," says de la Fuente. "Rather than relying on traditional, painstaking methods that involve collecting soil or water samples and purifying active compounds, we harness the vast array of biological data found in genomes, metagenomes and proteomes. This allows us to uncover new antibiotics at digital speed."

Given that bacteria evolve quickly, de la Fuente and his coauthors hypothesized that an environment that encourages competition -- like the human gut -- might be home to numerous undiscovered antimicrobial compounds. "When there is a lack of resources," de la Fuente points out, "that's when biology really comes up with innovative solutions."

The group focused on peptides, short chains of amino acids, which have previously shown promise as novel antibiotics. "We computationally mined over 400,000 proteins," de la Fuente says, referring to the process whereby AI reads the letters of genetic code and, having been trained on a set of known antibiotics, predicts which genetic sequences might have antimicrobial properties.

"Interestingly, these molecules have a different composition from what has traditionally been considered antimicrobial," says Marcelo D.T. Torres, a research associate in the de la Fuente lab, and the paper's first author. "The compounds we have discovered constitute a new class, and their unique properties will help us understand and expand the sequence space of antimicrobials."

Of course, those predictions must then be experimentally validated; after finding a few hundred antibiotic candidates, the researchers selected 78 to test against actual bacteria. After synthesizing these peptides, the researchers exposed bacterial cultures to each peptide and waited 20 hours to see which peptides successfully inhibited bacterial growth. In addition, the team later tested the antibiotic candidates in animal models.

Over half of the peptides tested worked -- that is, they inhibited bacterial growth of either friendly or pathogenic bacteria -- and the lead candidate, prevotellin-2, demonstrated anti-infective capabilities on par with polymyxin B, an FDA-approved antibiotic used today to treat multidrug-resistant infections, suggesting that the human gut microbiome may contain antibiotics that will someday find clinical application.

"Identifying prevotellin-2, which has activities on par with one of our antibiotics of last resort, polymyxin B, was very surprising to me," says Bhatt. "This suggests that mining the human microbiome for new and exciting classes of antimicrobial peptides is a promising path forward for researchers and doctors, and most especially for patients."

This study was conducted at the University of Pennsylvania School of Engineering and Applied Science, the Perelman School of Medicine and Stanford University. Professor de la Fuente holds a Presidential Professorship at the University of Pennsylvania and is supported by funding from Procter & Gamble, United Therapeutics, a Brain & Behavior Research Foundation Young Investigator Grant, the Nemirovsky Prize, Penn Health-Tech Accelerator Award, the Defense Threat Reduction Agency (HDTRA11810041 and HDTRA1-23-1-0001), and the Dean's Innovation Fund from the Perelman School of Medicine at the University of Pennsylvania. Professor Bhatt was supported by a Paul Allen Distinguished Investigator Award and the NIH (R01AI148623 and R01AI143757). Research reported in this publication was supported by the Langer Prize (American Institute of Chemical Engineers Foundation), the National Institutes of Health (R35GM138201), and the Defense Threat Reduction Agency (HDTRA1-21-1-0014). Additional co-authors include Angela Cesaro at Penn Engineering and Penn Medicine, and Erin Brooks, Hila Sberro and Cosmos Nicolaou at Stanford.

• Infectious Diseases
• Pharmaceuticals
• Pharmacology
• Human Biology
• Microbes and More
• Biotechnology and Bioengineering
• Antiviral drug
• Penicillin-like antibiotics
• Antibiotic resistance
• Deep brain stimulation
• Stem cell treatments
• Psychoactive drug

Story Source:

Materials provided by University of Pennsylvania School of Engineering and Applied Science . Original written by Ian Scheffler. Note: Content may be edited for style and length.

Journal Reference :

• Marcelo D.T. Torres, Erin F. Brooks, Angela Cesaro, Hila Sberro, Matthew O. Gill, Cosmos Nicolaou, Ami S. Bhatt, Cesar de la Fuente-Nunez. Mining human microbiomes reveals an untapped source of peptide antibiotics . Cell , 2024; DOI: 10.1016/j.cell.2024.07.027

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