Regular Banks: Operate on lending and borrowing funds based upon fascination. They finance all types of industries, besides People considered unlawful by legislation, and so are mainly cash lenders without having involvement in trade or enterprise.
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The rules of Islamic finance ban participation in contracts with extreme threat and/or uncertainty. The expression gharar actions the legitimacy of chance or uncertainty in investments. Gharar is noticed with derivative contracts and small-providing, that are forbidden in Islamic finance.
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Islamic banking aims to get rid of damage from monetary transactions by dealing with cash being a medium of exchange.
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Islamic Banking Concepts Islamic banking aims for making finance far more equitable by retaining fairness and transparency in the forefront of all transactions. It really works on many important concepts, like:
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