Investment Information And Analysis Articles

The first party is recognized as the Sahib-Al-Maal and the latter is referred to as the Mudarib. Any revenue accrued is shared between the two events on a pre-agreed basis, while capital loss is completely borne by the companion offering the capital. Thus, in Hire Purchase beneath Shirkatul Melk mode both the Bank and the Client provide fairness in equal or unequal proportion for purchase of an asset like land, constructing, machinery, transports and so on. Purchase the asset with that fairness cash, personal the same collectively, share the benefit as per agreement and bear the loss in proportion to their respective equity. The share, half or portion of the asset owned by the Bank is employed out to the Client associate for a set rent per unit of time for a fixed period. Lastly the Bank sells and transfers the ownership of it’s share / part / portion to the Client in opposition to cost of price fixed for that half either progressively half by part or in lump sum inside the rent interval or after the expiry of the rent agreement.

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