interest and islam

[Schuaeb]

Dears,

I think the Islamic nature of Islamic banking in Pakistan and even other parts of world has been discussed at a number of places. Somewhat consensus is found about the fact that Islamic banking yet is not truly Islamic till today. And, facts in this regard, I guess can be proved.

I'm indecisive about the fact that all sort of interest in todays banking is RIBA or not. I mean if a deposit holder is getting a fixed return on his profit that is less than the inflation rate then how come that person is getting extra money for his money, in fact he is in loss.

In my personal opinion (though I don't think I have much knowledge bout this) there are not many transactions in banking or commercial sector which do not take into account the time value of money. For example if we take into account the business market of Pakistan commodities are available on much cheaper prices if they are purchased on cash. And if they are purchased on credit extra amount depending upon the period of credit is to be paid. So what will this differential amount be called? Some scholars say it not interest nor Haram. However, I personally fail to reckon any logic that differentiates it from interest.

Once again as I said in the beginning, that my knowledge is very limited and I am never trying to prove that interest is or isn't Riba.

Regards
Shoaib