The only islamic banking product I'm personally involved in is my islamic housing loan, and frankly I don't see any effective difference from a regular housing loan.

I still pay interest, only that it's named something else (profit sharing? can't remember).

My loan is still pegged to BLR, only that it's named BFR instead (Base Financing Rate).

no difference from normal loan. the title is still in my name (and not the bank's name). of course, even with conventional loan you never really "own" the house until you've finished paying, cos if you stop paying the bank will repossess it

@am_eniey personally as someone who doesn't really follow closely riba and all these islamic banking terms & requirements, I fail to see any effective difference in today's islamic products. take my housing loan for example. Yes, the wording and structure is changed such that the bank is not charging me interest, instead now the bank is buying the property and re-selling it to me at a higher price.

however, in the legal docs the bank never really buys the property. the s&p is still only between me and the previous owner.
the 'profit sharing' portion is still based on a %'age that is still pegged to BLR (ok ... technically it's pegged to BFR and not BLR. But since BFR is also in turn pegged to BLR ... what's the difference?)

so in conclusion i can't help but be skeptical. as far as i'm concerned, these loans have removed the "word" interest from their literature but have not removed the concept of interest - it's no different from taking a bottle of champagne, re-packaging it as 'sparkling juice,' and selling it. the base product is still non-halal!

again, I must re-iterate that i know nuts about islamic banking requirements - i'm just saying what my perception is, so feel free to correct me.