From Twocircles.net: Islamic Jurisprudence or principles of Shariah does not allow receipt or payment of interest. It believes that money has no intrinsic value; however its commercial use is permitted. In the hand of an entrepreneur money turns into capital.
Lender of the capital is entitled to share the profit and loss of the business. A lender of the capital puts his money at risk and therefore is entitled for reward in the form of business profit……………….Full Article: Source