Dubai Islamic Bank & History Islamic Banking in Dubai


First, I will give a general introduction about Islamic banking and its history, then I will analyze the history of Dubai Islamic Bank and its branches, also I will talk about the products of DIB in specific. I will analyze the rules in DIB which, of course, under the Fatwa and Sharia’ah supervision Board, also I will explain the differences between Islamic banks and conventional banks. The future of DIB is shiny and I will end this project with a conclusion.

Introduction of Islamic Banking:

Before the emergence of Islamic banking, at the days of Prophet Muhammad, people were deposits their money with him or with Abu Baker Sedique, the first Khalif of Islam. The activity of Islamic Banking is like refusing the interests and accepting the deposits. At the end of 1960s, Islamic banking began to grow when several Muslim countries started to create this system. In 1973, there was the first meeting of the Islamic Organization Conference (IOC) in Jeddah. The meeting discussed the will of abolishing (canceling) the interests and creating financial system based on Islamic beliefs. Islamic Banking has many phases of revolution, the Expansion (1976 to the early 1980s), and there were 20 Islamic banks established from the Gulf eastward to Malaysia, and westward to the UK. The second phase of revolution is the Maturity (1983 to date), Arab banks opened Islamic branches in the USA and there were Islamic banking practices in both Pakistan and Iran. Several Islamic banks have been founded under the Islamic system, for example, Dubai Islamic Bank.

Introduction of Dubai Islamic Bank:

Dubai Islamic Bank was formed in 1975 and has 17 branches across the UAE. Dubai Islamic Bank issues are based on Sharia’ah compliant. DIB was opened Johara branch in Jumeirah, Dubai, in 2003, also offered other Johara branches in Abu Dhabi in year 2004 and Sharjah in year 2005, and now its available for 10 Johara branches across the UAE. The bank presents a number of Islamic social events such as the Dubai International Holy Quran Award. products:

Dubai Islamic Bank offers a special service for women which is the Johara. This service provide shopping discounts in some shops for perfumes, clothing, accessories, also Johara provides health educational benefits. DIB offers the customers ATM service across the UAE. DIB cares about the relationship with customers and provide them the advice that the customers may need in the financial part of life such as buying a car or starting up a business. The savings account in DIB authorizes the bank to invest the funds deposited by the customers. Profits are shared between the investor and the bank. The customers may deposit money at any time, but withdrawals are limited to one per month. Current Account has no interests, and cash deposits can be made by Cheques, Cash Deposits Machines, and ATM. Al Islami Investment Account offer the customers to make deposits and to make easy investing both in UAE Dirhams or US Dollars. The investment account at DIB is halal, and with an easy way of managing your disposable income that comes with the added plus of earning profits in an Islamic way. DIB’s credit cards designed for the present time. These credit cards have no “Riba” or interest. Al Islami VISA Charge Cards are available in Classic, Gold, and Platinum.

DIB Islamic laws:

The rules in DIB are all under the Fatwa & Sharia’ah supervision Board. The Board obeys the Fatwa & Sharia’ah rules. Board meetings arise periodically or whenever the need and the decisions must be agreed by all members. One law says the main source for the bank is Sharia’ah Fatwas. Another rule says to try to make more Sharia’ah compliant deals, events, and enhance bank’s products. There is a rule says analyzing new situations in the Bank’s deals that are not with any fatwa, so that Sharia’ah compliance make sure that the Bank won’t achieve any product before ensuring the new situation. Another rule for DIB is that analyzing contracts that about the Bank’s deals. Make Examinations and gives an opinion about Sharia’ah reports. There is rule says examining the Bank’s contracts, and all issues influencing the Board’s related to Sharia’ah compliance. When the Chairman of the Board of Directors submits a rule, then it would be analyzing by the Sharia’ah Board. Studying and analyzing the new issues received from any of the different departments and branches. A rule says initiating Sharia’ah training programmers for the staff in the bank. The achievements of the bank must be ensuring by the Sharia’ah rules and correcting the mistakes of the bank that may occur. A rule says doing an annual report on the Bank’s balance sheet of its Sharia’ah compliance. between Islamic banks and a conventional bank:

Business framework in an Islamic bank based on Sharia’ah laws, but the conventional banking is not based on religions laws only secular (worldly) banking laws. Balance between moral and material requirement in an Islamic bank resale the assets in order to reduce the added amount of credit but the conventional bank may make problems because of the too much use of credit. Equity financing with risk to capital is available in the Islamic bank and losses and profits are shared on the Sharia’ah participation but in conventional bank equity financing with risk is not available. In Dubai Islamic Bank, transactions (contracts) considered Gharar are forbidden but in conventional bank trading and dealing in derivatives of different forms is allowed. The dealings in the Islamic bank are based on the profit and loss sharing principle and the returns depended on bank performance and not guaranteed but in conventional bank profit and loss sharing is not available and the returns are depended on the bank performance and profitability. future of DIB:

With its top services, improvement products and the good electronics in the bank, DIB can lead the banking industry. The bank aspires to expand its business in other countries such as KSA, Iran, Turkey, Sudan, and Pakistan.


I prefer to invest my money in an Islamic bank because it is halal in the first place and in Dubai Islamic Bank (DIB), in particular, because it has many qualities. The last event that occurred to DIB is that the bank wins two Sheikh Mohammed Bin Rashid Al Maktoum Islamic Finance Awards and that was in March 21, 2006.






1. Dubai Islamic Bank Dubai Islamic Bank

3. Abu Dhabi Islamic Bank


Source : aacadaweb

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