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As we already know the arab community have a great respect of their holy book "the quran" and all their everyday life activities are based in what is written in it. In regards to the banking system, with the development of viable alternatives
to conventional finance increasingly enables Muslims to participate in the financial
world without violating their Islamic principles and without bearing the economic
penalty that comes from non-participatio.
Currently, the Islamic banking industry consists of several hundred billion dollars,
and more than 300 financial institutions in and outside the Muslim world.

AND NOW..WHAT IS ISLAMIC BANKING???
Islamic banking can be considered banking with a consciencE; it is based on two main financial principles. Firstly, investment is to be made in the private sector through interest-free financing. Secondly, the development of financial instruments is to be done on the basis of profit and loss sharing as well as sharing risks. Another important fact is that this type of banking is based around Shariah (prohibition of interest charge).

WHY A PROHIBITION OF INTEREST CHARGE??
Islam considers interest an unjustified increase of capital, with no effort made to earn it, it is considered of false value, and therefore is prohibited.

NOW, WHAT ARE THE DIFFERENCES BETWEEN ISLAMIC BANKING AND CONVENTIONAL BANKING???

ISLAMIC BANKING: -Interest is prohibited
-High degree of stability
-Customer shares the profit and loss with the bank
-The bank acts like an investment company, selling its stocks to
the public
-Bank and clients act like joint investors

CONVENTIONAL BANKING: -Charge of interest
-Lower degree of stability
-customer obtains fixed interest from
the bank and does not share loss

AN INTERESTING VIDEO...FEEL FREE TO WATCH IT!

http://www.youtube.com/watch?v=VunoFPhZha8