Islamic banking which follows Shariah law has been in operation since the enactment of the Islamic Banking Act in 1983. In these 30 years, Malaysia has been practising the dual-banking system - Islamic and conventional.
Islamic principles dictate that money lending (dealing with interest) as well as investing in businesses that are considered haram (unlawful) are prohibited. Islamic finance is all about accumulating all the available resources (from savings) and providing financing based on pre-determined profits rather than dealing with interest………………………………………..Full Article: Source