March 21, 2018

What’s the difference between the financial transactions between the conventional banks and the Islamic banks or Islamic financial institutions?

Conventional banks work based on two basic principles which are borrowing and lending. The concept is simple, the banks borrow money from the clients who deposit their money into the    bank’s accounts, the bank on the other end, lend that money to other clients who are looking for liquidity and the bank charges them interest which represents the profit of the bank.