Islamic banking financing terrorism or meeting economic demand?

Abstract

This thesis investigates the recent world-wide rise in Islamic banking. In doing so it (1) surveys the underlying religious foundation of Islamic finance, (2) examines the attempts of Islamists to use Islamic banking to Islamize societies, and (3) assesses how countries' use of Islamic banking fit into the international economic system. Drawing on this analysis, Islamic banking is finally examined from a national security perspective -- is this form of finance particularly susceptible to miss-use by terrorist groups? Although there are areas in the industry that need regulating and monitoring, this study ultimately concludes that Islamic banking's ties to terrorism are anecdotal, the expansion is the result of oil revenues and personal piety, and that Islamic banking can be leveraged as a means of moderation and enfranchisement when advanced free of an Islamist agenda.