Banking in Iran
Banking in Iran is like piggy banks, but much bigger and fancier! People put their money in banks for safekeeping and also to earn a little bit of interest on it. But because Iran is a special country, their banks are different from other banks in the world.
To start with, the central bank of Iran is called the "Central Bank of the Islamic Republic of Iran". You may wonder what "Islamic" means - it means following the religion of Islam. Iran is an Islamic country, so their banks follow the rules of Islam.
One of these rules is that banks are not allowed to charge or pay interest. That might sound strange because most banks do try to pay interest to their customers. But in Islam, having or earning interest is seen as a way of making money without doing any work, which is unfair.
So how do banks make money in Iran? They make money by charging fees for services they provide, such as transferring money, cashing checks, or using ATM's. They also invest the money deposited by people in a way that is compatible with Islamic rules.
Another thing that's different is that Iran has set up special banks called "Islamic banks". These banks use a system called "shariah-compliant banking", which follows Islamic rules. They have experts who check that all the financial transactions are done in a way that does not break any rules.
Last but not least, because Iran has been under sanctions from other countries for some time, their banking system has had to evolve in creative ways. They have developed their own domestic payment network, called "Shetab", which allows for electronic transfers between local banks.
So, in summary, banking in Iran is like piggy banks, but bigger and fancier. They follow Islamic rules, which means they don't charge or pay interest, so they use fees instead. They also have special banks called Islamic banks that follow shariah-compliant banking laws. And they have their own domestic payment network, called Shetab, which lets local banks transfer money electronically.
To start with, the central bank of Iran is called the "Central Bank of the Islamic Republic of Iran". You may wonder what "Islamic" means - it means following the religion of Islam. Iran is an Islamic country, so their banks follow the rules of Islam.
One of these rules is that banks are not allowed to charge or pay interest. That might sound strange because most banks do try to pay interest to their customers. But in Islam, having or earning interest is seen as a way of making money without doing any work, which is unfair.
So how do banks make money in Iran? They make money by charging fees for services they provide, such as transferring money, cashing checks, or using ATM's. They also invest the money deposited by people in a way that is compatible with Islamic rules.
Another thing that's different is that Iran has set up special banks called "Islamic banks". These banks use a system called "shariah-compliant banking", which follows Islamic rules. They have experts who check that all the financial transactions are done in a way that does not break any rules.
Last but not least, because Iran has been under sanctions from other countries for some time, their banking system has had to evolve in creative ways. They have developed their own domestic payment network, called "Shetab", which allows for electronic transfers between local banks.
So, in summary, banking in Iran is like piggy banks, but bigger and fancier. They follow Islamic rules, which means they don't charge or pay interest, so they use fees instead. They also have special banks called Islamic banks that follow shariah-compliant banking laws. And they have their own domestic payment network, called Shetab, which lets local banks transfer money electronically.