Islamic banking operates based on three key principles. First, it strictly prohibits the use of interest rates on loans, ensuring that no additional charges are imposed beyond the original loan amount. Second, banks generate profits solely through equity participation systems. Under this model, banks receive a share of a company's profits once the loan is repaid, but they bear the risk of earning nothing if the loan defaults. Finally, Islamic banks are forbidden from investing in high-volatility sectors (e.g. Energy and Technology)