Money Jihad blog has posted two important articles over the past week regarding the Shariah-compliant alternative to conventional financing known as murabaha.

One thing to remember about┬ámurabaha is that, almost invariably, these arrangements cost the borrower more than conventional financing would. Money Jihad compares┬ámurabaha to “rent-to-own” deals in the US. We think the comparison is valid and Money Jihad goes on to explain key differences between the two, especially this aspect of┬ámurabaha:

There is no fundamental effort by rent-to-own sellers to introduce an alternative set of orthodox religious financial laws to Western markets in order eventually to replace them.

And unlike rent-to-own deals in the US, murabaha arrangements are used for large purchases, such as houses…

http://moneyjihad.wordpress.com/2011/09/21/weekly-word-murabaha/

In addition to the basic introduction to murabaha, Money Jihad followed up with an illustration of how a Shariah mortgage works, including the fact that a portion of the proceeds go to zakat, and all-too commonly jihad. This of course makes Shariah-Compliant Finance unique and troublesome to non-Muslims around the world.

http://moneyjihad.wordpress.com/2011/09/26/murabaha-markup-funds-sharia/

 

 

 

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