List down difference and similarities between

mudarabah and mushrikah

Mudarabah
1. Capital is provided by each party involved
2. All investor involve in running the business
3. If facing a loss, all parties must bear with it according to the capital they
chipped in for the initial cost
4. Right after the initial capital of the parties are combined, all assets that are
generated or purchased, automatically belong to all partner according to the
capital ratio
5. Thus, any increase in the value of the co-owned assets will benefit and profit
all partners based on equal ownership
6. The similarity between Musharakah and Mudaraba his both parties share the
profit with pre-agreed ratios

Mushrikah
1. Capital is provided by the investor only, while the other party becomes the
manager, without putting in any money
2. The investor is not directly involved on the business management
3. If facing a loss, only the investor will bear the loss, while the party that run
the business will loss in terms of time and energy with no compensation
4. If the manager is careless in his duty, the lost capital must be repaid and
borne by the business manager
5. All assets purchased by the business manager for the business using capital
from the investor or ‘rabbl mal’belong to the investor
6. Any increase in the value of the purchased asset belongs to the investor as
well, not the manager.