Parallel salam is
based on two independent salam contracts whereby the financier will be both the seller and the buyer in this arrangement
. … Then, this IFI may enter into a salam contract as a seller with another party for a shorter period of delivery of the asset.
What is Salam contract in Islam?
Salam is
a sale whereby the seller undertakes to supply some specific goods to the buyer at a future date in exchange of an advanced price fully paid at spot
. The contract of Salam creates a moral obligation on the Salam seller to deliver the goods. The Salam contract cannot be cancelled unilaterally once signed.
What is Salam transaction?
Salam is
a contract in which advance payment is made for goods to be delivered at a future date
. Profit and loss sharing suggests an equitable sharing of risks and profits between the parts involved in a financial transaction.
What is parallel istisna?
An istisna’
a contract in which the buyer (manufacture orderer, or almustasni’) doesn’t set a condition in the contract obliging the seller
(al-sani’) to undertake manufacturing the subject matter (commodity, asset, item, etc) by himself. Parallel istisna’a is also known as back-to-back istisna’a. …
How does istisna work?
Istisna is a financial instrument in Islamic finance in which
a manufacturer agrees to complete a construction project on a future date for a fixed, agreed-upon price and with product specifications that both parties agree
to.
What is difference between istisna and Salam?
Istisna’a is mainly used in the fields of manufacturing (both small scale and large scale), construction, Build, Operate and Transfer (BOT), etc. However, salam is mostly confined to the trading of commodities, particularly those that require from the seller (al-muslam ileihi)
no additions or alterations
.
What is purpose of Salam?
One of the central conditions in Salam contract is related to price payment (ra’su l-mÉl). The price has to be paid before the separation of the two contracting parties. This is because the specific purpose of Salam is
to fulfil the instant need of the seller (muslam ilayhi)
.
What are the conditions of Salam?
It
should be measured or weighed in its usual measure only
, meaning what is normally weighed cannot be quantified and vice versa. The exact date and place of delivery must be specified in the contract. Salam cannot be affected in respect of things, which must be delivered at spot.
What is meant by Murabaha?
Murabaha, also referred to as cost-plus financing, is
an Islamic financing structure in which the seller and buyer agree to the cost and markup of an asset
. The markup takes place of interest, which is illegal in Islamic law.
What is meaning of Kafalah?
Summary. Legally, kafalah means
the joining of one obligation to another with regard to the settlement of a claim
. In kafalah, a person joins another in undertaking a certain obligation. Consequently, both persons become jointly liable for the settlement of the same obligation.
What is istisna Urdu?
The Urdu Word استثنا Meaning in English is
Exception
. The other similar words are Aitraaz, Girift and Istasna. The synonyms of Exception include are Barring, Excepting, Exclusion, Excusing, Expulsion, Omission, Rejection, Repudiation, Reservation, Passing Over, Debarment and Noninclusion.
How does a Murabaha work?
In a murabaha transaction,
a financing party buys an asset that has been identified by its client (borrower) from a third-party and then sells that asset to the borrower for the original purchase price plus a profit element
(generally calculated based on a benchmark figure such as LIBOR). …
What is the meaning istisna?
Istisna refers to
a contract for the acquisition of goods by specification
where the price is paid at the time of contract, or paid gradually in accordance with the progress or on completion of a job.
What are the conditions of istisna any 3?
A contract of Istisna is binding on the contracting parties provided that certain conditions are fulfilled, which include: •
Specification of the type, kind, quality and quantity of the subject-matter to be produced
. Price of the subject-matter must be known and the delivery date must be determined.
What is Tawarruq concept?
According to Malikis, tawarruq means
selling something on deferred basis and then buying it back in cash
, albeit at a lower price than the deferred price. For example, someone sells his commodity at a price that is already known to be paid by the deferred payment.
What is the purpose of Salam in Islam?
a salutation meaning
“peace
,” used especially in Islamic countries.
