Islamic banking in Pakistan

The purpose of this study was to investigate the Islamization of banking in Pakistan. Pakistan introduced an interest free Islamic Banking System on January 1, 1981. A gradual switch from traditional banking system to Islamic banking system was promised.;In this paper efforts were made to investigate the IES in general and introduce Islamic Banking System in Pakistan in particular. The statistical analysis of 9 years of Islamic banking in Pakistan supports the argument of Islamic Economist that "Islamic Economic System may be a viable alternate to the existing economic system of the world.".;The Islamization of banking comes under the Islamic Economic System. The Islamic Economic System means to follow the Quranic guidance about the economy for achieving justice or "Al-Adl" which brings higher prosperity and welfare in the society. The new system abolishes the interest rate from the economy and encourages a Shirakat business (partnership) on profit and loss basis.