Analytical Study of Dual banking and Earlier Efforts towards Islamization of Bank of Khyber in the light of Shariah
The proposal of interest-free banking is very old because Islam restricted the interest base transaction at very beginning after the revelation of prohibition of Interest, noble Quran called it as Riba. This prohibition is of sever nature relatively, Allah says; O you who have believed, fear Allah and give up what remains [due to you] of interest, if you should be believers. And if you do not, then be informed of a war [against you] from Allah and His Messenger.
The suggestion for the establishment of such financial institutions that run according to shariah has been put in queue for about centuries. To get rid from the dominancy of conventional banking system, forced the religious scholar to take initiative in this regard and started interest free banking. It was not easy to switch entirely from conventional banking system to Islamic one as for different technical issues, leads the existent banks to start dual banking system.
Bank of Khyber is the first Bank of Khyber Pakhtunkhwa operating as dual banking, i.e. Conventional as well as Interest free banking. This study focuses on analysis of dual banking system of bank of KHYBER in order to know the extent of conformity with shariah standards along with highlighting the earlier efforts of it towards Islamization.