Sunday, 22 April 2012

Financial Crisis under Islamic Finance

The below strategy is at evolving stage...

Interest is prohibited in Islam however, we can take profits from the investment. Who'll share the risk is the main question. In conventional interest based system the entire risk is forwarded to the customers who borrows from the bank and then bear the entire risk. In an Islamic finance framework lender and borrower both has share in profit and risk, still it depends on the agreement between the two parties. Thus Islamic finance has lesser instability than interest based finance since lender is also careful of lending to the risk seeker person.

2 comments:

Muhammad Tariq Majeed said...

This is true that an Islamic finance has lesser instability than interest based finance since lender is also careful of lending to the risk seeker person.

Muhammad Tariq Majeed said...

Your comment on Islamic finance is worth appreciating.