A shariah compliant solution for asset financing
Ijarah is a term of Islamic fiqh and it means “to give something on rent” or “to acquire service”. Ijarah can be defined as “transferring of usufruct of an asset to another person for an agreed period and agreed rent”. The asset should be valuable, identified and durable not consumable.
Purpose
To meet the long term business requirements, such as project financing, BMR activities and fleet financing
Target Market
Corporate, Commercial and SME sectors who qualify the BAHL’s minimum financing criteria.
Difference between Ijarah & Conventional Loan
| Distinguishing Factor | Ijarah | Lease |
|---|---|---|
| Ownership and risk | The asset is owned by bank and all ownership related risks are assumed by bank. | No clear demarcation between rights and liabilities of bank and customer. |
| Commencement | Rental commenced after the delivery of asset. | Installment normally starts before the delivery of asset. |
| Delayed Payment | Customer pays charity in case of delayed payment of rental, which will not be part of Bank’s income. | In case of delayed payment a penalty is charged and taken to income |
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