Securitization means issuing certificates of ownership against an investment pool or business enterprise. This article discusses the issues, problems, and rules in issuing such certificates with respect to the nature of investmen…
The concept of Musharakah and Mudarabah is based on some basic principles. As long as these principles are fully complied with, the details of their application may vary from time to time. Let us have a look at these basic princi…
In Islamic Shariah, it is allowed that instead of sale, the lessor signs a separate promise to gift the leased asset to the lessee at the end of the lease period, subject to his payment of all amounts of rent. This arrangement is…
Basic rules of ijarah: (1) Transferring of usufruct not ownership: In leasing an owner transfer its usufruct to another person for an agreed period, at an agreed consideration. For example if a persone have some property and…
In fact it, Istisna, is a safe transaction where a commodity is transacted before it comes in to existence. Therefore, we can say that it is an order to a manufacturer to manufacture a specific commodity for the purchaser. In cas…
To proceed forward to the topic of parallel Salam, it is necessary to provide a short sketch of Salam, so that the concept of parallel Salam easily comes to our minds, and easily understand. In salam we have learned that it is us…
After working on Islamic banking I have identified some features of Murabahah financing, some of these are given below, and I think would be valuable for the readers. (1)- Murabahah is not a loan given on interest. It is the sale…
This mode of financing can be used by the modern banks and financial institutions especially to finance the agricultural sector.In salam, the seller undertakes to supply specific goods to the buyer at a future date in exchange of…
( Sale on deferred payment basis) Some of the rules for Bai Mu’ajjal is also provided here in the following pares, 1 – A sale in which the parties agree that tha payment of price shall be deferred is called a Bai, Mu’ajjal. T…
First of all it is necessary to define that what is meant by sale, its definition is given below, Sale can be defined, in Shari’ah, as “ the exchange of a thing of value by another thing of value with mutual consent ”. Islamic…
Most of the Islamic banks and financial institutions are using “Murabahah” as an Islamic mode of financing, and most of their financing operations are based on Murabahah. That is why this term has been taken in the economic ci…
Another form of Musharakah, developed in the near past, is Diminishing Musharakah. According to this concept, a financier and his client participate either in the joint ownership of property or equipment, or in a joint commercial…