Question Bank on Islamic Banking Principles for Bank Jobs – Practice & Study Guide
30 MCQs on Basic Principles of Islamic Banking for Bank Jobs in Bangladesh and Worldwide – Shariah Based Islami Bank
Islamic banking follows Shariah (Islamic law), which prohibits riba (interest) and promotes ethical financial practices based on fairness, transparency, and risk-sharing. Unlike conventional banking, Islamic finance operates on profit-and-loss sharing, ensuring that all transactions are backed by real assets and avoid excessive uncertainty (Gharar).
For those preparing for bank job exams in Bangladesh, understanding the core principles of Islamic banking is essential. To help you test your knowledge, we have compiled 30 multiple-choice questions (MCQs) covering key topics such as prohibition of interest, profit-sharing models (Mudarabah, Musharakah), ethical investments, and Islamic financial instruments (Murabaha, Ijara, Sukuk, Takaful).
These Islamic banking MCQs will help you prepare effectively for recruitment exams in Bangladesh Bank, Islami banks, and other financial institutions that operate under Shariah-compliant banking principles. By practicing these questions, you will gain a solid understanding of Islamic finance concepts and improve your chances of success in bank job exams.
Disclaimer:
This study guide and MCQs are for educational and informational purposes only. While we strive to provide accurate and up-to-date content, we cannot guarantee the accuracy, completeness, or reliability of the information. Additionally, we do not guarantee that these questions will appear in actual bank job exams. Candidates should refer to official banking exam syllabi and guidelines for precise preparation.
Below, you’ll find 30 well-structured MCQs designed to test your knowledge of the basic principles of Islamic banking. Let’s get started! 🚀
Basic Principles of Islamic Banking – MCQs
1. What is the main principle of Islamic banking?
A) Interest-based transactions
B) Profit and loss sharing
C) Speculative investments
D) Gambling-based transactions
Answer: B) Profit and loss sharing
2. What is riba in Islamic banking?
A) Profit
B) Charity
C) Interest
D) Investment
Answer: C) Interest
3. Which Islamic contract is similar to a joint venture partnership?
A) Murabaha
B) Ijarah
C) Musharakah
D) Wadiah
Answer: C) Musharakah
4. In Islamic finance, gharar refers to:
A) Uncertainty and excessive risk
B) Profit-sharing
C) Ethical investing
D) Asset-backed lending
Answer: A) Uncertainty and excessive risk
5. Which Islamic contract involves cost-plus financing?
A) Mudarabah
B) Murabaha
C) Ijarah
D) Istisna
Answer: B) Murabaha
6. The concept of mudarabah in Islamic banking is best described as:
A) Profit and loss sharing partnership
B) Lease agreement
C) Fixed deposit
D) Interest-based loan
Answer: A) Profit and loss sharing partnership
7. Which of the following is prohibited in Islamic banking?
A) Profit sharing
B) Riba
C) Equity financing
D) Asset-backed financing
Answer: B) Riba
8. What is Ijarah in Islamic banking?
A) A lease contract
B) A sale contract
C) A profit-sharing contract
D) A savings account
Answer: A) A lease contract
9. Which Islamic financial principle ensures that investments must be ethical and socially responsible?
A) Gharar
B) Halal investment
C) Wadiah
D) Tawarruq
Answer: B) Halal investment
10. Which organization provides international standards for Islamic finance?
A) IMF
B) World Bank
C) AAOIFI
D) WTO
Answer: C) AAOIFI
11. What is the key difference between conventional and Islamic banking?
A) Islamic banking allows gambling
B) Islamic banking prohibits interest
C) Conventional banking follows Shariah
D) Conventional banking is not profit-driven
Answer: B) Islamic banking prohibits interest
12. Sukuk is the Islamic equivalent of:
A) Bonds
B) Shares
C) Insurance
D) Loans
Answer: A) Bonds
13. Which of the following is NOT an Islamic financial instrument?
A) Murabaha
B) Musharakah
C) Derivatives
D) Mudarabah
Answer: C) Derivatives
14. What is the purpose of a Shariah board in an Islamic bank?
A) Marketing and promotions
B) Supervising compliance with Islamic principles
C) Handling customer complaints
D) Managing human resources
Answer: B) Supervising compliance with Islamic principles
15. The Islamic principle of takaful refers to:
A) Islamic insurance
B) Islamic loans
C) Islamic deposits
D) Profit-sharing investment
Answer: A) Islamic insurance
16. Islamic banking prohibits investment in:
A) Halal businesses
B) Alcohol and gambling industries
C) Real estate
D) Agriculture
Answer: B) Alcohol and gambling industries
17. What is Wadiah in Islamic banking?
A) A savings account where funds are kept as a trust
B) A profit-sharing contract
C) A leasing contract
D) A loan with interest
Answer: A) A savings account where funds are kept as a trust
18. Tawarruq is used in Islamic banking for:
A) Profit-sharing investments
B) Personal financing
C) Charity donations
D) Gambling activities
Answer: B) Personal financing
19. Which of the following is an Islamic contract for manufacturing or construction financing?
A) Istisna
B) Ijarah
C) Salam
D) Murabaha
Answer: A) Istisna
20. In mudarabah, the party providing capital is called:
A) Rabb-ul-mal
B) Mudarib
C) Wakil
D) Musharik
Answer: A) Rabb-ul-mal
21. What type of contract is Salam in Islamic banking?
A) Deferred delivery sale
B) Lease contract
C) Profit-sharing contract
D) Investment contract
Answer: A) Deferred delivery sale
22. An Islamic bank earns a profit mainly through:
A) Interest on loans
B) Profit-sharing contracts
C) Currency speculation
D) Stock market manipulation
Answer: B) Profit-sharing contracts
23. Which of the following is NOT an Islamic banking product?
A) Murabaha
B) Mudarabah
C) Fixed-interest loan
D) Sukuk
Answer: C) Fixed-interest loan
24. Who oversees the compliance of Islamic banks with Shariah principles?
A) Central Bank
B) Shariah Supervisory Board
C) Government Regulators
D) IMF
Answer: B) Shariah Supervisory Board
25. What does “halal investment” mean in Islamic finance?
A) Investing in any business
B) Investing only in Shariah-compliant businesses
C) Investing in speculative markets
D) Investing in high-risk ventures
Answer: B) Investing only in Shariah-compliant businesses
26. What is the Arabic term for Islamic equity partnership?
A) Ijarah
B) Musharakah
C) Tawarruq
D) Sukuk
Answer: B) Musharakah
27. The prohibition of excessive uncertainty in contracts is known as:
A) Riba
B) Gharar
C) Wadiah
D) Takaful
Answer: B) Gharar
28. The profit-sharing ratio in mudarabah must be:
A) Fixed in advance
B) Decided after profit realization
C) Based on bank discretion
D) Not mentioned in the contract
Answer: A) Fixed in advance
29. Which of the following is a risk-sharing financial instrument?
A) Conventional mortgage
B) Islamic bonds (Sukuk)
C) Interest-based savings
D) Fixed-interest deposits
Answer: B) Islamic bonds (Sukuk)
30. Why does Islamic banking avoid interest-based transactions?
A) To increase bank profits
B) To comply with central bank rules
C) Because riba is prohibited in Islam
D) Because it is unprofitable
Answer: C) Because riba is prohibited in Islam
These MCQs cover key concepts of Islamic banking and can help candidates prepare for bank job exams in Bangladesh. Let me know if you need modifications or explanations.
