Islamic financial products have developed remarkably from straightforward structures to highly complicated instruments. During the 80s and 90s, Islamic financial products were dominated by deposits and savings, syndicated project financing, shariah-compliant stocks and mutual funds. The last decade has witnessed the unveiling of more complicated structures, including various sukuk models, derivatives, Islamic structured products, Islamic hedge funds, and others. Most, though not all, of them are reverse-engineered replications of conventional products, splicing together nominate contracts from the Islamic fiqh legacy with a few modifications to satisfy legal requirements and become “shariah-compliant”. Tawarruq is a shariah-compliant concept that has facilitated the introduction of wide-ranging Islamic financial products, from deposit and financing instruments to liquidity management and debt restructuring, sovereign and private sukuk structuring, and risk management and hedging instruments. _e concept has gained full acceptance from industry players mainly because its built-in features and characteristics can often deliver economic outcomes similar to that of conventional products. This Occasional Paper provides a fresh approach in discussing tawarruq, looking into the historical evolution of the concept and the chronological development of shariah views on its ruling.

1. Finance ? Religious aspects ? Islam. 2. Finance (Islamic law). 3. Banks and banking ? Religious aspects ? Islam.