Abstract
Abstract This article discusses the growth of Islamic banking and finance institutions over recent years and the IFC's activities in Islamic funds, leasing, and infrastructure finance. The major Islamic financial product types are described in terms of the corresponding debt and equity‐like contracts in use in western banking and finance practice. Islamic leasing and funds are well adapted to many of the constraints facing borrowers and lenders in the developing regions of the Islamic world and also provide both borrowers and investors with Sharia‐based financial claims. Viewing Islamic Sharia‐based products as a means of providing scarce contractual governance services that improve the risk‐return equation facing investors in a competitive international capital market, the future growth prospects for Islamic products sector are assessed to be significant. © 1999 John Wiley & Sons, Inc.