On Islamic Banking

I was recently asked my opinion on Islamic banking. I know next to nothing about that. I am told that it is against Islamic principles to charge interest on loans. As a liberal, I take the position that people ought to be free to do whatever they want with their property. They should be free to lend their money at whatever interest they want (including zero interest or a million percent interest.) The only condition is that there must be no coercion involved.

Therefore, anyone who is handing out interest free loans out of their own wealth will find a willing borrower in me. Although it is obvious that giving out interest-free loans is an idiotic thing to do, I don’t believe it is anyone’s business to force people to avoid folly.

I sometimes get to know of some Indian politicians’ call for Islamic banking in India. More power to them. I am all for Islamic banking, Christian banking, Voodoo banking, Jewish banking, Buddhist banking, Brainless banking, or whathaveyou. The financial intermediation services provided by banking are vital to economic well-being. But as always, I am against the use of force and aggression.

As long as the government does not take my money so that it can give it to Islamic banks to lend it out at zero interest rate, I am fine. People who follow Islamic principles may wish to do so but making me follow Islam under threat of force will invite massive resistance and retaliation from me.

Until India formally becomes an Islamic state (like Pakistan and Bangladesh), any Indian politician who demands Indian banks follow Islamic principles should be taken out and shot.

5 thoughts on “On Islamic Banking

  1. Absolutely agree with you. No place for Islamic banking in India, because according to that principle, fleecing money from kuffars is halal. So that would mean the interest for that loan would be paid by the infidels and that is indirect jiziya on the kuffars.

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  2. Islamic Banking is a joke. Yes, they don’t charge interest on loans – but what they do instead is become ‘part owners’ of whatever you use the money for. Therefore, you make a monthly payment to them which is not ‘interest’ but a share of the profits earned. This share is fixed, and you have to pay it, even if you don’t make any money, under certain conditions.

    It’s a pig with lipstick on it.

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  3. “…any Indian politician who demands Indian banks follow Islamic principles should be taken out and shot.”

    so much for your liberal ideals and for freedom of speech.

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    1. Yes sir, I am like that only. All liberal and shit, but when the chips are down, calling for shutting people up by shooting them. Taking them out and shooting them first thing in the morning, even before having a coffee. Can’t get anything past you, can I? Truly amazing powers of observation!

      Seriously though, your inability to comprehend a tongue in cheek sign off is sad. You could have raised some principled objection to what I wrote — such as that no-interest banking or loans have positive benefits for the system, or that I am mistaken in my belief that financial intermediation is important for the functioning of an economy. But no, you decided to focus on the trivial. Nicely done, sir, nicely done.

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