We must start Interest Free Banking.

1. Interest Free
Banking

2. 
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Interest Free Banking is a interest free system
which depends upon the system of profit & loss
sharing.
Interest free banking encourages people to invest
their money and to become partners in order to
share profits and risks in the business instead of
becoming creditors.
The purpose of interest free banking is not only
the making profits but also more developing the
easiness in business & life of peoples.
Profit is a partial thing, produced as the result of
business. According to interest free system, this
profit is divided into participants respectively.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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3. 
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India's global competitor China has also
permitted interest free banking. If India do not
start this banking, then We can not run ahead
than china.
Interest free banking do not centralize the money
and remove economic disbalance among
peoples. While capatilist economy is a interest
based system, in which elite group get more &
more rich and poor peoples loss more & more
money.
In this 21st century, we can not run ahead while
ignoring this banking.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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4. 
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Interest free banking is a banking of Aam Aadmi.
Interest free banking is a balanced and totally
transparent system.
Making profit-loss sharing and careness of each
other are the basic principles of interest free
banking.
75 countries of world have started 1300 interest
free banks.
If developing countries like India take loan from
interest free banks instead of capatilist banks,
then capatilist economy would start to collapse.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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5. 
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By 2016, interest free economy of world would
became of 1 trillion dollar with 15% progress rate.
Interest free banking can help to establish peace
and economic prosperity for the whole mankind.
First complete Interest free bank was established
in Dubai, 1995.
Interest free banking is becoming a very popular
amongst international investor. It is not a closed
system. It has no regional, ethnic or class
affiliations.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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6. 
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Interest free banking is less prone to inflation.
Interest free banking finance is based on the
belief that the provider of capital and the user of
capital should equally share the risk of business
ventures, whether those are industries, farms,
service companies or simple trade deals.
Interest free banking is an instrument of banking
in a natural way, which has came recently before
peoples
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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7. Difference between
conventional banking and
Interest Free banking
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8. money
Bank
Client
money + money (interest)
Conventional
Banking System
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9. Bank
Goods &
Services
Client
money
Interest Free
Banking System
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10. Conventional Banks
Interest Free Banks
Money is a commodity besides medium of
exchange and store of value
Money is not a commodity thought it is
used as a medium of exchange and store
of value
Time value is the basis for charging interest on
capital
Profit on trade of goods for charging on
providing service is the basis for earning
profit
Interest is charged even in case the
Interest Free bank operates on the basis
organization suffers losses by using bank's fund of profit and loss sharing
While disbursing cash finance, running finance
or working capital, no agreement for exchange
of goods & services is made.
The execution of agreements for the
exchange of goods & services is a must
while disbursing funds under contracts
Conventional banks use money as a commodity Interest Free banking tends to create link
which leads to inflation
with the real sector of the economic
system by using trade related activities.
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(lalitcomnet@gmail.com)
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11. Conventional banks
Interest Free Banks
The investor is assured of a pre determined
rate of interest
In contract it promotes risk sharing between
provider of capital (investor) and the user of
funds (entrepreneur)
Lending money and getting it back with
compounding interest is the fundamental
functions of the conventional banks
Compounding calculation is strictly prohibited
under Interest Free banking system
It can charge additional money incase of
defaulters
The Interest Free banks have no provision to
charge any extra money from the defaulters.
Conventional banks invest their deposit in
interest based modes
Interest Free banking only deals in Halal
products and services
The status of a conventional bank, in
The status of Interest Free bank in relation to
relations to its clients, is that of creditors and its clients is that of Partners, Investors, and
debtors.
Trader, Buyer and Seller.
A conventional bank has to guarantee of all
its deposits.
Interest Free banks cannot guarantee of all its
deposits.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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12. Basic Principles of Interest
Free Banking
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Sanctity of contracts.
Risk sharing.
No Interest.
Economic purpose / activity.
Fairness.
No valid subject matter.
Prepared By: Lalit Kumar Agarwal
(lalitcomnet@gmail.com)
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14. Interest Free Banking Fare vis-àvis Conventional Banking
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The approach of Interest Free banking to
satisfy the business needs of the customers
is entirely different from that of the approach
adopted by conventional banking. Basically
Interest Free banking satisfies the business
needs of the entrepreneurs by the following
two methods.
Profit and loss sharing modes
Debt creating modesLalit Kumar Agarwal the purchase
(financing
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of commodities on credit with a mark-up)
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15. Focus Areas
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