cing. Islamic banks, however, can eliminate the doubtful forms of financing and offer a clean and efficient interest-free banking. This can be put into effect by making use of only two forms of financing -- loans with a service charge and Mudaraba (or participatory financing) -- both of which are fully accepted by Islam. Such a system will create a competitive advantage where Islamic banks and conventional banks both co-exist. In addition, Islamic banks will have no difficulty in establishing and operating in non-Muslim countries.Mudaraba is a unique feature of Islamic banking, and can offer responsible financing to socially and economically relevant development projects. This is an additional service Islamic banks offer over and above the traditional services provided by conventional commercial banks.Therefore, Islamic banks have the potential to compete with perhaps even outperform the common commercial banks that are currently available if they follow the Shari’ah rulings and put it in effect....
