Allow me to relate my experience with Maybank for which I applied for a housing loan late last year. That's when the horror started.

After scouting through promotions and offers on housing loans from various local banks, it seemed that Maybank's Islamic Banking housing loan was the best scheme that suited my current pay scale.

This was because the interest on the Bai' Bithaman Ajil standard plan was increased progressively through the 25-year loan period starting from 3.88% for the first year, 6.5% for the 2nd year, 7.5% from 3rd to 10th year, 8% from 11th to 20th year and 8.5% from the 21st to 25th year.

Looking at the interest rate and the amount that it totalled up to in terms of the monthly installment, it sounded too good to be true.

After the bank's approval and signing-up for the loan was completed, I waited for the payment instruction letter for servicing the interest payment as my house was still under construction. Four months passed by without any payment instruction notice.

I enquired and their reply was that the loan was still being processed and I should receive my instruction in due course. Two more months passed by before I finally received a payment notice to service my first interest charge.

The notice was dated in March 2004 and the payment was to be made within the same month. Since the postman only dropped it in my mailbox in April, it was already way over the due date.

I decided to wait for the second payment notice and pay two months' of interest charge plus a late payment charge since I did not make the first payment on time. The second notice dated April came in May and I immediately made the payment the next day.

A couple of days later, I received yet another letter notifying that my housing loan interest rate had been revised to the maximum of 8.5% for the whole tenure of the loan period which is 25 years

With no experience in housing loans before, I went down to the bank for clarification. Their answer for the revision was that since I defaulted on the first payment of interest, they had the right to increase my interest rate to the maximum level.

To my horror, they pointed out that it was in the loan agreement under the 'Condition' clause. Right, the fine print.

I wrote my first letter of appeal to the bank stating the delay in receiving my payment instructions had caused me to miss my first payment. The appeal was rejected with Maybank saying their instruction was sent on time.

I wrote in a second letter of appeal, this time copying to the Islamic Banking Division of Bank Negara. It was turned down again.

At Maybank's website , there is a clear description on the meaning of Islamic banking. It states that the philosophies and principles of Islamic Banking are outlined in the Holy Quran and the Sunnah of Prophet Muhammad (p.b.u.h) more than 1,400 years ago.

As a new convert to Islam, I have come to learn the true meanings of Islamic teachings. As I understand, Prophet Muhammad (p.b.u.h) was strongly against the collection of usury ('riba') and I'm sure he was not very keen to let the lending party profiteer excessively either.

So is Maybank truly practicing Islamic banking or is it for namesake only? Is Bank Negara regulating the Islamic banking industry in the country by regularly keeping an eye on the local banks?

I'm sure that in the original Bai' Bithaman Ajil plan drafted in the days of the Prophet, there would have never been a clause requiring the lender to increase interest if the borrower defaults or pays up late by one month.

Why have a clause in the loan agreement giving the bank the right to increase interest rate to the maximum if the borrower defaults in servicing the interest charges? This is the most vulnerable time for customer to miss out on payment.

Even if it is not the customer's fault, it could be the postman's fault. Or could it be the bank, sending out instruction letters late so as to cash in on that clause.

I think this it is very un-Islamic and even worse than 'alongs' and conventional banking schemes. I hope other Malaysians who are in the same predicament come forward and protest to Bank Negara on unethical ways Maybank is conducting its business.