---
title: "What is Shariah? | IslamicOpenFinance™"
description: "Islamic law and its principles; in finance, the rules that contracts, products and institutions are expected to comply with."
url: https://islamicopenfinance.com/glossary/shariah/
lang: en-GB
source: "IslamicOpenFinance"
---

[Glossary](https://islamicopenfinance.com/glossary/) / [Shariah fundamentals](https://islamicopenfinance.com/glossary/#fundamentals)

Shariah fundamentals

# Shariah

Islamic law and its principles; in finance, the rules that contracts, products and institutions are expected to comply with.

In IFSB standards, Shariah is defined as the practical divine law deduced from its legitimate sources: the Quran, the Sunnah, consensus, analogy and other approved sources. In finance the word refers to the rules and principles that contracts, products and institutions are expected to follow. How those rules apply to a given product is decided by qualified scholars, usually through a Shariah board, and the answer can differ between schools and jurisdictions.

## Sources

- [IFSB-31 Guiding Principles for Effective Supervision of Shariah Governance, 2025: Definitions, Shariah](https://www.ifsb.org/wp-content/uploads/2025/07/IFSB-31-Guiding-Principles-for-Effective-Supervision-of-Shariah-Governance.pdf)

This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.

## Related terms

[**Fiqh al-muamalat** The branch of Islamic jurisprudence that governs commercial and financial dealings between people.](https://islamicopenfinance.com/glossary/fiqh-al-muamalat/) [**Maqasid al-Shariah** The objectives of Shariah: protecting people's interests and averting harm, used to guide how rules are applied.](https://islamicopenfinance.com/glossary/maqasid-al-shariah/) [**Shariah supervisory board** An independent panel of Shariah scholars that approves an institution's products and oversees its Shariah compliance.](https://islamicopenfinance.com/glossary/shariah-board/) [**Fatwa** A juristic opinion on a Shariah question; in finance, usually a Shariah board's ruling on a product or transaction.](https://islamicopenfinance.com/glossary/fatwa/)

**Shariah fundamentals**

1. [Riba](https://islamicopenfinance.com/glossary/riba/)
2. [Gharar](https://islamicopenfinance.com/glossary/gharar/)
3. [Maysir](https://islamicopenfinance.com/glossary/maysir/)
4. [Fiqh al-muamalat](https://islamicopenfinance.com/glossary/fiqh-al-muamalat/)
5. [Maqasid al-Shariah](https://islamicopenfinance.com/glossary/maqasid-al-shariah/)
6. [Riba al-nasiah](https://islamicopenfinance.com/glossary/riba-al-nasiah/)
7. [Riba al-fadl](https://islamicopenfinance.com/glossary/riba-al-fadl/)
8. [Al-ghunm bil-ghurm](https://islamicopenfinance.com/glossary/al-ghunm-bil-ghurm/)

[All 221 terms](https://islamicopenfinance.com/glossary/)