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Islamic Finance Briefing - Categorized | Banking, Islamic Law / Economics more

Bai Salam systematic banking

Posted on 06 March 2009

From Aawsat.com: A Bai Salam contract [where advance payment is made for goods] is one of the [financial] contracts that is permitted under Islamic Shariaa Law. In the Sahih Muslim collection of Hadith [sayings of the Prophet] Ibn Abbas narrated: The Prophet came to Medina and the people used to pay in advance the prices of the fruits that would be delivered within one or two years.

The Prophet said [to them] “Buy fruits by paying their prices in advance [only] on condition that the fruits are to be delivered to you according to a fixed specified measure within a fixed specified period.” This is why Muslims unanimously approve the permissibility of this [financial] practice. …. Full Article: Source

 
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