Over the last four decades, there has been a debate among Islamic scholars and economists about the need for Islamic financial institutions to actively participate in the social welfare sector if they are to claim to be in line with the principles of maqasid al-shariah.
The proponents of Chapra’s model have argued that Islamic financial institutions should actively embark on social welfare initiatives so as to perfect the Islamic economic eco-system. Halim’s model, on the other hand, has emphasised the active role of Islamic financial institutions in profit maximisation endeavours, maintaining their pivotal role as financial intermediaries, arguing that less involvement in social welfare initiatives and PLS activities will not negate their contribution to the system.
