Bai Salam; in the light of the Holy Quran & Sunnah and its role in Islamic banking.

Abstract

Allah made halal to Bain ad made haram to Riba. All the types of Riba are categorically haram; likewise all the types of Bai are halal except those which are declared prohibited in the Ahadith. Among the permissible Byuoo, one is As Salam or a type of deferred sale in which goods are received or delivered later while the payment is made in advance. This type of Bai is being used in the Islamic banking industry as a mode of financing for small business as well as agricultural purpose. It is also very useful for the Muslim agricultural countries i.e. Pakistan as they wish to replaced the interest based banking system with Islamic banking. This study helps to understand the validity of salam in the light of Holy Quran and Sunnah as well as importance for Pakistan