PROFIT-INTEREST RATE PROXIMITY AND DIFFERENCES IN THE FRAMEWORK OF CREDIT AND PARTNERSHIP
KREDİ ve ORTAKLIK ÇERÇEVESİNDE KAR-FAİZ YAKINLIĞI VE FARKLILIKLARI

Author : Kemal Yücel
Number of pages : 596-617

Abstract

The basis of credit-interest and partnership- profit systems is as old as the history of mankind. Over time, the attitudes of the financial intermediary institutions to the interest in the applications of credit and partnership systems led to the emergence of deposit banking and participation banking. According to studies conducted in terms of interest and profit concepts, the common point of two concepts is to increase cash capital. However, the two concepts mentioned differ in terms of the effects they have on the economy. Similar and different aspects of profit and interest concepts are presented in the study. Therefore, the focal point of the study is to reveal that the concepts mentioned are related to each other although they are different. Therefore, in Turkey between the years 2006-2015 the average annual interest rate applied by commercial banks with an average annual profit rate applied by the participation banks were compared. Accordingly, it can be seen that there was no big difference between profit and interest rates in the years mentioned. This shows that profit and interest rates are determined under the same market and the same competitive conditions.

Keywords

Credit, Partnership, Profit, Interest

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