Money as it should be, in an Islamic System

This paper first examines the normative characteristics that money should possess in an Islamic economy, as indicated by the texts of Shariah and the reasoning of leading jurists. It concludes that fulfilling the rulings and objectives of Shariah concerning money does not require clinging to the material forms that prevailed during the legislative era (gold and silver). Rather, what is essential is the stability of money’s value, which is a fundamental condition for its efficiency in performing its functions.

The paper further argues that the issuance or creation of money is among the duties and responsibilities of the legitimate authority (walī al-amr) and should not be delegated to non-governmental entities driven by profit motives, such as commercial banks. The study engages with opposing views and concludes that realizing the Shariah requirement of monetary stability necessitates a trustworthy, competent, and independent monetary authority.