19.04.2010 - Islamic finance A glossary of terms
From IPE: Bai Bithaman Ajil: A contract for deferred payment on the sale of goods. A bank buys goods requested by the client. The bank sells the goods to the client at cost plus profit. They client settles payment in instalments within a predetermined period or in lump sum. Gharar Lit: The sale of something with unknown consequences, which opens the transacting parties to risk or uncertainty. Examples include selling goods the seller cannot deliver; selling known or unknown goods at an unknown price; or making a contract conditional on an unknown event. Risk and uncertainty are forbidden in sharia.........................................Full Article: Source
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