THE FORMATION AND HISTORICAL DEVELOPMENT OF THE ISLAMIC FINANCIAL SYSTEM

Abstract

The Islamic financial system is a unique economic framework that is rooted in the principles of Islamic law, known as Shariah. It differs fundamentally from conventional financial systems in its objectives, mechanisms, and ethical foundations. Islamic finance is not merely a set of financial techniques but a comprehensive system that integrates moral values, social justice, and economic activity. Its formation and historical development reflect the interaction between religious principles and changing economic realities across different historical periods.