Despite the fact that recently Islamic banks have in fact grown considerably, nowadays they still represent an extremely small share compared with the entire banking system of the planet. This confirms the extraordinary growth potential of a system which presents aspects that are objectively more fair to those parties that, in western finance, are normally weaker (suffice to think of someone applying for a loan or a mortgage), and so it reveals a more than innovative aspect of the possible economic policy rules to be considered, as an alternative to those known in western Countries. Also, and above all, in the light of the serious crisis already manifesting itself by the end of 2008, more serious by far than the forecasts made by most of the reliable economists. Perhaps it is also because of this that Islamic Banking is being considered by a number of western institutions, or that new ones, choosing to base their operations on the Islamic system, are being established in non-Islamic Countries: in difficult times, when one’s certainties waver, one is more open to discovering alternatives. In this sense perhaps, ethical banks represent the most tangible example of a flourishing system based on values in this environment, in opposition to the so-called "rules of the market" and to the notorious and questionable paradigm of the opportunist matrix’s political economy, at the very core of capitalism, according to which the main purpose of every commercial operation must be to obtain maximum results with the least possible effort.
But, what are the values on which Islamic Banking is developed? Its basic principle regards prohibition of Riba ("usury" or "interest"), which is founded on concepts of simple morality and common sense, as in most religions. These principles are universal to the non-Islamic reader as well: usury was forbidden in both the Old and the New Testament of the Bible, even Shakespeare and many other literary greats vented themselves against this cruel practice. Throughout history, other writers manifested their total aversion to usury (think of Dickens, for example, who wrote profusely on the fair distribution of richness and on every human being’s fundamental right to be able to work). Both of these have been basic principles of Islamic Banking right up to modern times, when, in a structured way, the banking systems put the essence represented by religious creeds into practice, applying it to the financial world.
In the Middle Ages, many Islamic Countries practiced finance founded on Islamic principles, with results that strongly stimulated commerce and the activities connected with it: from Spain through to the Balkans, Islamic merchants became indispensable commercial intermediaries. Many scholars consider that, as a precise result of the strong development of Islamic finance during the lengthy medieval era, many of its concepts, techniques and instruments were then also adopted by European businessmen and financiers.
During Islam’s golden era, the first versions of proto-capitalism and free markets developed in the Caliphates within which, between the VIII and XII centuries, a first type of market economy was born, together with the mercantilist system. Several historians consider it as a form of "Islamic Capitalism". Thanks to the constant growth in the circulation of currency (the dinar) and in its value, at the same time both high and stable, as well as to the integration of previously independent monetary areas, a strong monetary economy ensued.
Numerous concepts and innovative techniques affirmed themselves during the first forms of Islamic Banking, such as, for example: payment orders, early types of partnership (mufawada), the first kinds of capital (al-mal), raising of capital (nama al-mal), bank cheques, bills of exchange, trusts, newly established enterprises, current accounts, loans and transfers. Furthermore, in the medieval Islamic world there were also organised enterprises similar to companies and independent of the State, together with the setting up of agencies (intended as representative offices), which were established exactly in those times. Many of these principles of early capitalism were then adopted by medieval Europe starting from the XIII century.
In classical Islamic jurisprudence, the Riba was the "value added without counterpart" or "assuring equivalence to actual value". Furthermore, the "numeric value was immaterial".
Nevertheless, despite the fact that for many centuries the whole Islamic world founds its business relationships on the principles of Islamic Law, Islamic Banking, in the sense of actual banking institutions, was to come to light only in the second half of the XX century. The modern re-birth of Islamic Banking came about on the occasion of the world festivities for the advent of the XV century of the Islamic Calendar (Hijra) in 1976. Another important phenomenon was taking place at the time: financial resources of many Islamic Countries, mainly deriving from the production of crude oil, experienced an extraordinary increase thanks to the rationalisation of tariffs for the so-called black gold which, until then had been controlled by foreign corporations. These were the events that brought Muslims to committing themselves so that their lives could be harmoniously structured according to Islam’s ethics and philosophy. The lack of ethical values in the other financial systems drove not only the Muslims themselves, but also other peoples to seek them in their financial and commercial relationships.