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In conventional banking interest predetermines a fixed rate of return on a loan advanced by the financier irrespective of the profit earned or loss suffered by the debtor, while the Islamic Musharaka contract, given that interest is deemed impermissible in Islam, does not envisage a fixed rate of return. Musharaka is a partnership agreement whereby the Islamic bank provides funds, which are mixed with the funds of the business enterprise and sometimes others. All the providers of capital are entitled to participate in management but are not necessarily required to do so. The profit is distributed among the partners in pre-agreed ratios, while the loss is borne strictly in proportion to respective capital contributions. This case describes the rationale and applications of the Musharaka contract.