Document Type : Paper

Authors

• Sayyed Saeed Shamsinajad ¹
• Mohammad Talebi ²

¹ Assistant Professor of Hazrat Masoumeh University

² Assistant Professor at Department of Finance, Faculty of Islamic Education and Management, Imam Sadiq University, Tehran, Iran.

Abstract

After exceeding eight years from its establishment, and despite its considerable size of dealings, Iran's Rial Interbank Market has not yet managed to develop its position in the state’s money market through creation of necessary diversities in transactional mechanisms. Application of treasury bills as a short-term monetary instrument is globally fostered. After adoption of sale of debt in the state’s monetary system, application of Islamic treasury bills was lodged in the 2014 Budget Act. Supplying these bills in the capital market one year later could result in formation and development of a secondary market for such bills. The main question of this research is posed as “How could Islamic treasury bills be used to promote the efficiency of Iran's Rial Interbank Market?” By explicating the performance and recognizing Iran's Interbank Market shortcomings, the present article intends to examine the application of Islamic treasury bills as a short-term monetary instrument in Iran's Interbank Market. Findings of this study achieved through a descriptive-analytical methodology by referring to Shiite jurisprudence and finance texts are expressive of the fact that Islamic treasury bills are capable of being applied in Iran's Rial Interbank Market.

Keywords

• Interbank market
• Islamic Treasury Bills
• Islamic Repurchase Agreements

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