Terms Definition

1 Al-bai` Sale contract

Al-ijarah thumma al-bai Lease contract followed by ownership

2
(AITAB) of asset through a sale contract

Sale contract followed by repurchase

3 Bai` `inah
by the seller at a different price

4 Bai` dayn Sale of debt

Sale contract based on

5 Bai` bithaman ajil (BBA) deferred/installment payment at certain
price

Sale contract based on order of certain

asset with certain specifications. Full
payment is made in cash at the time of
6 Bai` salam
conclusion of the contract whereas the
delivery of the asset is deferred to a
specified time

The knowledge or rules on estate

7 Faraid distribution according to Islamic
principles

A discipline of knowledge that

8 Fiqh muamalat discusses the rules relating to human
affairs

9 Gharamah Fine/penalty

1
Gharar Uncertainty
0

1
Hibah Gift
1

1 Rebate/waiver of partial or total claim

Ibra’
2 against certain right or debt
 Lease or service contract that involves
1 benefit/ usufruct of certain asset or
Ijarah
3 work for an agreed payment or
commission within an agreed period

Sale contract by way of order for certain

1 product with certain specifications and
Istisna`
4 certain mode of delivery and payment
(either in cash or deferred)

1
`Iwad Consideration
5

1
Kafalah Guarantee
6

1
Maysir Gambling
7

1
Mudarabah Profit sharing contract
8

1
Muqasah Offsetting
9

Sale contract with a disclosure of the

2
Murabahah asset cost price and profit margin to the
0
buyer

Sale contract without the disclosure of

2
Musawamah the asset cost price and profit margin to
1
the buyer

2
Musyarakah Profit and loss sharing
2

A contract of partnership that allows

Musyarakah mutanaqisah one (or more) partner(s) to give a right
2
to gradually own his share of the asset
3
  to the remaining partners based on
agreed terms

2 Qard Loan contract

4

2
Rahn Pledge/charge
5

Refers to certificates of equal value

which evidence undivided ownership or
2
Sukuk investment in the assets using Shariah
6
principles and concepts endorsed by
the Shariah Advisory Council.

2
Ta`widh Compensation
7

2
Tabarru’ Voluntary donation/contribution
8

A scheme which is based on the spirit

of cooperation and helping each other
2 by providing financial assistance to
Takaful
9 participants when needed and all
participants mutually agree to give
contribution for the said purpose

Tawarruq/commodity murabah Purchasing an asset with deferred

ah price, either on the basis of
3
musawamah (refer no.21) or
0
murabahah (refer no. 20), then selling it
  to a third party to obtain cash

3
Ujrah Commission
1

3
Wa’d Promise
2

Safe keeping contract in which a party

3 entrusted his property to another party
Wadi`ah
3 for safe keeping and to be returned
upon request

3
Wakalah Agency contract
4
 A form of endowment by an owner of a
3
Wakaf property for public benefit and wellbeing
5
which is allowed by Shariah