The Principles of Islamic Banking and the Nigerian Business Environment

Why did Islam prohibit interest? What is the logic behind that? What types of interest has Islam prohibited? These are certainly the questions that face both Muslim and non-Muslim economists. When Islam was introduced 1400 years ago, one of the main issues discussed, was Riba or interest Sharia prohibits the payment of fees for the renting of money (Riba, usury) for specific terms, as well as investing in businesses that provide goods or services considered contrary to its principles (Haraam, forbidden). It is the finding of this study that both Islamic and conventional banks can operate harmoniously in Nigeria. It was also recommended that Islamic banking be given a chance for rapid economic recovery of the economy.