How Can Sharia Banks Afford To Give Out Interest Free Loans?
A Reader Asks…
I have heard that islamic banks give out interest free loans because islam forbids charging interest. How can they afford to do this? What is the catch? What is in it for them? Why would anyone take out a regular loan with interest if this type is available?
(Scroll down to see responses)
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Tags: "give, Afford, Banks, Free, interest, Low Rate Loans, Sharia
July 31st, 2009 at 12:56 am
In basic terms, the bank buys the item on your behalf – say, a house if we’re talking mortgages – then sells it to you at a higher price.
July 31st, 2009 at 7:51 am
The links below will introduce you to the Islamic and Sharia banking system here in UK, how it works and what you might expect from it.http://www.islamic-bank.com/islamicbankl…http://www.which4u.co.uk/mortgages/shari…http://www.bankersonline.com/vendor_guru…http://www.bbc.co.uk/religion/religions/…http://www.dailymail.co.uk/debate/articl…
I would not worry about what is said in the above DM article. Seems to me that our own Western banks have failed us, why not give Islamic and Sharia banking a try?
Most people of my aquaintance are not looking for masses of interest but a safe haven for their money and if Sharia banking can supply that, then it looks set to grow and prosper here in UK.
July 31st, 2009 at 1:39 pm
I would hope that people wouldn’t fall for these interest free or loan offers that come to their e-mails since they wind up asking for money to cover a couple months worth of payments up front and then when you send them the money you never see the loan or hear from them ever again.
July 31st, 2009 at 4:03 pm
You get charged an arm and a leg quite literally
July 31st, 2009 at 5:49 pm
because there clever =)
July 31st, 2009 at 10:00 pm
These loans have CHARGES, guess what, these charges work out at roughly the same as paying interest.
August 1st, 2009 at 4:07 am
let’s just say that you’ll never want to miss a payment.