Historical Roots of Islamic Finance in Malaysia: From the Pre-Islamic Era until 1983 traces the historical background that led to the development of Islamic finance in Malaysia. It examines major economic and political developments from the ancient past until 1983, the year the Malaysian government established the first Islamic bank in Malaysia. Particular emphasis is given to the coming of Islam followed by the challenge posed by colonialism, particularly the introduction of interest-based banking during the British era and the role it played in integrating the local economy into an international economic system in which local economic actors played a marginal role. The Malaysian experience is also placed in the larger context of the 20th century movement in the Muslim world to free the economic and financial system from interest-based dealings in order to mobilise resources for development from which the public at large would benefit
