Challenges and Growth Prospects of Islamic Banking in The Kingdom of Bahrain
Islamic banking system has emerged as a competitive and a viable substitute for the conventional banking system during the last four decades. However, Islamic banks are also finding it challenging to cope with the evolving global banking environment and making appropriate rules and regulations to cope with these changes while still remaining competitive with their conventional counterparts. Accordingly, this study attempts to evaluate the growth of Islamic Banking in the Kingdom of Bahrain and to examine and focus on the challenges faced by the growth of Islamic Banking. The findings of the study have shown that Islamic banking growth over years in the Kingdom of Bahrain is a result of many factors. One of its main factors is the Government support by having reputed regulations and legislations through the Central Bank of Bahrain and other regulatory bodies. This study is therefore expected to further contribute towards investigating opportunities to strengthen the Islamic banking industry in the Kingdom of Bahrain, which will support its banking sector as one of the main financial centres in the GCC region.
Key Words- Islamic banking and finance, conventional finance, Kingdom of Bahrain, growth of Islamic banking, challenges.