For Sharia Banking System
- In Sharia Law, money is supposed to be intrinsic, and no interest charges are supposed to be levied on money lending. This can form a separate law on Islamic Banking System.
- The Islamic Bank can form a bridge between government, company and lenders in a 3-1 tier system, where a zero percent financing is levied on every customers.
- In Sharia Law in Islamic Banking, interest against principal is not charged. EMIs, Loans levy zero charges.
- Charges can be levied on the time-line of moratorium period. Pre-Payment will fetch a time-line before the payment, which can be hedged against a loan versus a loan for a greater moratorium period.
- The third party can collect transactions charges levied on the principal amount for company and bank lending.
- Interest on the difference of a moratorium period can create interest charges for a gap on the timeline. Deferral and accrual can create a loan against loan for exchange terms.
- Infrastructure lending can have a 2-3 % less percentage than normal loan period. Varied interest charges can be levied for infrastructure lending. Slab pricing can be kept for differential interest. A spread can be used as well for differential interest.
- Interest rates can vary with timeline as well. A 6-month loan can have a different rate of interest than an 1-year and 2-year period loan.
- The segments within the BPL can be named as ABPL and BPL. Advanced BPL can be a segment much lesser than the poverty line.
- BPL segment can be defined in the range of 1250-1500 INR per month, with a daily expense pegged at INR 50.
- Zero profit booking can happen in some companies. New laws can be enacted for maintaining Sharia Laws.
- There can be a price cut as well. Based on the difference of the loan amount dispersed, interest percentage can vary.
- There can be a 7-tier banking system. The principal system can be investment banks like JP Morgan, multinational retail banks like Citibank, Indian retail banks as HDFC, NBFC turned full-bank as Bandhan Bank, Savings bank like Post Office and banks for only the BPL segment.
- State Governments can work with the central government to work with PPP terms with a private player.
- Sharia Laws can also try to consider a nominal percentage in their banking system by enacting a separate law.