Financing Utilities and Services in Islamic Banking Institutions

Abstract:
The topic of financing utilities and services is considered one of the most important innovative financing methods in the field of Islamic banking. It refers to the financing of service rentals for clients of Islamic banks and financial institutions, whereby the institutions acquire services at a current (immediate) payment and then provide them to those in need on a deferred or installment basis. This method helps meet customer needs in areas such as education, healthcare, tourism, and travel, while also providing practical solutions to pressing social issues. At the same time, it stimulates investment in these vital sectors by increasing market demand for such services.

This subject has gained considerable importance recently due to its growing prevalence in the Islamic financial sector. However, it continues to be a subject of discussion and debate among scholars, jurists, and researchers. In this study, we will adopt a descriptive analytical approach to examine and define all aspects of this vital and significant topic by addressing its economic and jurisprudential dimensions.

Accordingly, the study will focus—God willing—on the following key areas:

• The concept, importance, and characteristics of services and utilities, as well as the types that can be financed.
• The jurisprudential framework for financing services and utilities, including evidence for its legitimacy and the associated Shariah regulations.
• The economic and social impacts of implementing this type of financing, along with potential risks and the financial returns it can generate.
• Mechanisms for applying this banking service in Islamic financial institutions in general, including the limits and challenges of its implementation.