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Islamic Finance Briefing - Categorized | Finance, Islamic Law / Economics more

Avoiding conflicts of riba

Posted on 25 January 2013

A fundamental difference between conventional and Islamic finance is that, as the Islamic system does not permit risk-free capital, those operating under the Shariah framework cannot profit from the lending of money. Accordingly, the charging of interest known as riba is prohibited by the Shariah and instead, a system of risk sharing is promoted.
Riba can be defined as any increase over and above the principal amount payable under a contract, which is not covered by a corresponding increase in labour, commodity, risk or expertise………………………………………..Full Article: Source

 
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Laxman - who has written 19160 posts on Opalesque Islamic Finance Briefing.


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