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Are the financial instruments provided by Islamic Banks interest free or interest masking ?

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Question added by Ammar Fairdous , Assistant Professor , Taif University
Date Posted: 2016/03/31
Nuridin Islam Diab
by Nuridin Islam Diab , Training Manager , Bbusinesss LLE

Good question. I believe the answer really depends on which Islamic Bank we're looking at and which specific instrument are we examining. From my experience, I've seen both, the interest free (buy/sell base transactions for example Murabaha) and I've seen the forms of Tawarruq which falls into back to back sales (Ba^ul ^Aynah) which is forbidden in Islam. 

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