The Emirates lay down the law on interest-free banking

The UAE is currently considering a law to regulate Islamic financial institutions. The law would establish regulatory licensing, external religious supervision, and internal religious supervision. Islamic banks do not fit the definition of banks because they offer a wider range of services than conventional banks. Islamic banking is relatively recent but its principles are as old as Islam. Islam prohibits hoarding wealth and practicing riba (interest), and operates on a principle of public good. Islamic economics protects private property, avoids the accumulation of excessive wealth, and develops a society in which class and sectorial interests are jointly served. The relationship between an Islamic bank and its customer is more contractual than that of a conventional bank. Deposit accounts present a problem to Islamic banks because they operate with a pre-determined rate of return. Islamic banks must pool and invest funds and operate on a profit-and-loss sharing system with