An ideal solution for long and short term financing
According to the concept, a Bank and customer participates either in the joint ownership of a property or an equipment/Asset, or in a joint commercial enterprise. The share of the Bank is further divided into a number of units and it is understood that the client will purchase the units of the share of the Bank one by one periodically, thus increasing customer’s own share till all the units of the financier are purchased by the customer so as to become sole owner of the property, or the commercial enterprise.
Purpose
To meet the long term business requirements, such as project financing, BMR activities and fleet financing.
Target Market
Corporate, Commercial, SME and Consumer sectors who qualify the BAHL's minimum financing criteria.
Difference between Diminishing Musharakah & Conventional Loan
| Distinguishing Factor | Diminishing Musharakah | Conventional Loan |
|---|---|---|
| Contract | It is a partnership contract. | It is a loan contract. |
| Commencement | Rental commenced after the delivery of asset. | Installment may starts before the delivery of asset. |
| Ownership & Risk | Asset is jointly owned and the risk is shared in proportion of ownership. | Asset is owned by the customer and all risks are borne by him. |
| Income | Income is generated by renting out the bank’s ownership. | Income is generated by charging mark-up on loan. |
| Repayment | Customer pays the rental, and purchases the units. | Customer pays the installment comprising of mark-up and principal repayment. |
آپ کو بھی اس میں دلچسپی ہو سکتی ہے
Murabaha Finance
Meet Your Short-Term Business and Individual Need for making purchases the Shariah compliant way
Istisna Finance
Get Financing For Your Manufacturing/Construction Business Staying True To Your Values