What are the principles of Islamic Banking and Finance?

<p>Here are the major principles of Islamic Banking &amp; finance: </p><ul><li><strong>Profit and Loss Sharing: </strong>It is one of the key principles of Islamic finance, where the partners will share their profit and loss according to the part they play in the business. There will be no guarantee on the rate of the returns that the Muslims will play the part of a partner and not a creditor.</li><li><strong>Shared Risk: </strong>In economic transactions, risk sharing is promoted by Islamic banking. When two or more parties share the risk, which is based on the principles of Islamic banking, the burden of the risk will be divided and reduced among the parties.&nbsp;</li><li><strong>Gharar:</strong> According to Islamic finance principles, Muslims are not allowed to participate in transactions that are ambiguous or uncertain (Gharar).&nbsp;</li><li><strong>Gambling: </strong>In Islam, the acquisition of wealth through evil means or participation in Maysir (gambling) is prohibited. It will protect Muslims from conventional insurance products because that is a type of gambling.&nbsp;<br>No Investment in Prohibited Industries: Industries that are harmful to society or pose a threat to social responsibilities are prohibited by Islam, so in Islamic banking. These industries include&nbsp;Pornography,&nbsp;Prostitution,&nbsp;Alcohol,&nbsp;Pork, and Drug.</li></ul>

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