Glossary of terms

Justice.
A contract that is executed between two or more parties.
A non-refundable deposit or down payment on a sales contract in which the buyer has not paid the full price or taken possession of the goods. The buyer retains the right to cancel the sales contract.
The moral and ethical behaviour of a person or group.
Islamic Jurisprudence.
Islamic commercial jurisprudence.
Any excessive uncertainty or ambiguity within a contract, transaction or business dealing.
A narrative record of the sayings of the Prophet Muhammad (PBUH).
Lawful/permitted in Islam.
UnLawful/prohibited in Islam.
The transfer of money, debt or an obligation from one person to another.
A gift.
A bilateral lease contract allowing the transfer of the usufruct of an asset rather than the sale of the asset.
A lease contract with the option to own the leased asset at the end of the lease period.
A lease contract with option to acquire the leased asset at the end of the lease period
The consensus of a majority of leading and qualified jurists on a Sharia’a matter.
An agreement often used to finance projects including manufacturing, construction and infrastructure where the payment is either deferred or immediate with the delivery of the project deferred until completion.
Suretyship or guarantee.
Commercial transactions.
Partnership contract where one party provides the funding and the other party manages the project. This product is a sub-set of Musharaka.
The party in the Mudarabah that manages the project
A cost plus financing transaction which includes an agreed profit margin, the payment is deferred for an agreed period of time.
A form of Murabaha where the seller and the buyer bargain on price without reference to the actual price paid by the seller.
A flexible partnership contract between two or more parties who all contribute capital towards the funding of a project or asset. Profits are pre- agreed with any losses being shared on the basis of the contributed capital.
A parallel contract to an existing Salam contract to hedge the Salam position. The contract is often for an outright sale with deferred delivery but could be arranged with payment at a later date using a Letter of Credit or guarantee to secure the payment.
The Islamic holy book and primary source of Sharia’a.
Party in a contract, such as a Mudaraba that provides the capital.
A pledge.
Islamic re-insurance undertaken to reduce excessive concentration risks by Takaful companies.
Generally translated as interest or usury but also means an excess or unfair gain. Riba is usually classified as either Riba al-fidl or Riba-am-naseeyah.
Is an exchange of commodities or money in unequal amounts.
Is a money for money exchange with a deferral, interest is charged for the deferral. Riba an-Naseeyah is the same as interest in the conventional market.
A Salam is a contract for the purchase of a commodity for immediate payment with deferred delivery.
The purchase and sale of currency at spot for equal value.
Islamic Law derived mainly from the Quran and Hadith.
Plural of the Arabic word Sakk meaning certificate. Sukuk is a certificate representing a participation and ownership rights in an underlying asset. Sukuk are often referred to as an Islamic Bond however there are some inherent differences.
Words and actions of Prophet Muhammad (PBUH).
Non-commercial donation or gift where there is no benefit or commercial advantage for the donor.
Islamic insurance comparable to mutual insurance with the insured donating their contribution to a mutual fund.
Purchase of a commodity on a Murabaha basis that is immediately sold on to a 3rd party at spot for cash.
A unilateral Promise, where an undertaking or promise is made by one party to do or not do something at a future date.
A contract of agency where a party/person is appointed to perform a specific task for a certain fee.
An obligatory donation to charity for Muslims who have wealth above an exemption limit at a rate fixed by Sharia’a.

Awards

2019

Best Fixed Account Provider by Moneyfacts

2018

Best Fixed Account Provider by Moneyfacts

2017

Best Islamic bank in the UK by Islamic Finance News