Islamic financial institutions, because of their active involvement and knowledge of the nature of businesses of their clients, are in a better position to detect and prevent the channeling of depositors’ money for financing highly risky but equally remunerative anti-social activities. The financing it provides is mostly asset-based, whereby the Islamic bank knows the actual utilization of its funds.
Yet, ironically, the consumer’s voice is often the weakest and, very often, is not heard. For this reason, the international community has increased its focus on how to better protect financial consumers. The G20 has adopted nine High-level Principles for Financial Consumer Protection.