Kiddie-Pool Loan Ends Indonesian Invisibility in Islamic Banking
Islamic banking and loans without interest are the key to Indonesia's growth in the field of Islamic finance. A good example of such loans is the story of 50-year-old widow Nur Hanifah, who took out a Shariah-compliant loan from Bank Muamalat Indonesia in order to help finance a store on the ground floor of a shophouse. She does not pay interest but instead she must give the bank a certain percentage of her profit plus part of the principal each month. The percentage usually is about 40%. Hanifah explains that even when times are bad, she does not have any financial worries because then she does not have to pay anything compared to times when she has good profit.