Islam allows only one kind of loan and that is qard-el-hassan (literally good loan) whereby the lender does not charge any interest or extra amount over the money lent. The Bank must share in the profits or losses arising out of the organization for which the money was financed. Unlike the interest-based conventional banking system where all the pressure is on the borrower, Islamic finance is primarily based on the belief that the depositor, the bank, and the borrower should all share the risks and the rewards of financing business ventures.

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