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essential yet the most important point is the.
concepts of islamic finance yeah this is very essential see here.
concepts of islamic financing in islam rate of interest is entirely.
restricted yes you can” t usage cash to generate income paying or. Billing interest from people is completely restricted in islam all.
If any transaction entails passion then that” s not enabled in islamic. financial organizations right and after that buying services. entailed in prohibited tasks yes islamic banks you recognize.
they can” t be associated with any organizations which sells prohibited tasks.
forbidden tasks such as you recognize betting, hooking, porn and then what do you state.
alcohol business which handle alcohol, pork yeah all these are.
prohibited activities in islam songs market.
yeah all these things fine so if any type of organizations are involved in these.
They depend on some future occasion then that” s also not allowed all
. due to the fact that there is excessive risk it amounts to gambling yeah both of.
these points are like betting just so that” s a forbidden. task in islam so you can ‘ t handle those kind of purchases.
and those kind of contracts you recognize such as complicated acquired instruments.
and short selling are totally banned penalty and the.
major concept another concept is the risk needs to be shared yeah the risk of.
any type of contract in between the lender and the borrower must be shared.
great that” s the major concept of islamic finance penalty and afterwards the last.
is wealth needs to be generated from legitimate profession and asset-based.
investment either it must be asset-based or asset-backed.
all right for each every transaction there have to be a hidden property.
yeah you can” t just make use of cash to make cash that ‘ s simply rate of interest. all right you can ‘ t do that so that ‘ s the last concept of islamic finance. fine so i wish you have actually recalled whatever we.
did in the very first video clip yeah if you wish to go deeper after that.
Please go in the initial video and view it once again all.
fine after that i” ll placed the link in the description listed below now returning to.
this video clip in this video what we” re mosting likely to do is. in this video clip we are visiting different forms of contracts of islamic. finance yep different types of items or the services that are used by.
islamic banks fine so what are the enabled ways to do.
you recognize banking that” s what we are going to see. over below currently as you can see the concepts of islamic finance there are.
Many constraints so tell us what is permitted.
yes this is it right these are the 5 significant contracts that are permitted.
in islam fine so currently allow” s discuss this set by one madaraba musharraka sukuk.
yeah allow” s discuss this by one okay currently here we have the very first agreement of.
islamic financing see below Mudaraba Mudaraba is very same like collaboration all right.
partnership or joint endeavor here what will certainly take place is here there will.
be 2 individual entailed alright optimum 2 person just yeah it can”
t be. more than 2 so one event will certainly bring the resources.
yeah one event will bring the cash and the other party will certainly bring the.
ability yeah it” s a collaboration deal where. one celebration provides the cash hundred percent of funding. and the other offers monitoring competence yeah other event will bring.
the ability currently this celebration that brings the funding.
will be called as money vendor of financer in english.
however in arabic it is called as he is called as rab-al-maal.
all right rab-al-maal and after that the party which brings the ability.
the management competence the labor company that will do all the job.
yes this individual the functioning companion will be called as Mudarib all right so currently this individual who is the cash.
provider the financer he will just add funding he will.
not join monitoring okay he” ll be the sleeping companion. Working partner sleeping partner is that clear. Currently right here what will certainly happen this service either this
business organization will certainly. profit if it makes profit after that it will certainly be dispersed in the. pre-decided ratio alright the ratio the revenue sharing proportion will certainly be chosen in. If in case god forbid there is a loss after that completely, beforehand itself alright however.
the loss will certainly be borne by the financer fine the who the rab-al-maal.
the cash vendor the individual that has brought in the resources entire.
loss will be birthed by the the capital service provider.
Since it is considered that you recognize, okay why is it like that see below.
this person has actually done his 100 person yeah he has.
participated and he has actually worked truly difficult and still he couldn” t gain earnings. he couldn ‘ t make profit in this company after that it is believed that it is said.
that you recognize he has actually done 100% of his work so he can” t. be punished yeah he can” t be because he doesn ‘ t have the cash that ‘ s why he has. only brought his ability yeah yeah he doesn ‘ t have cash and or.
anything so that” s why he can ‘ t bear the loss only the money carrier.
will bear the loss it ‘ s suggested like that in islam.
Because of his neglect or his, yes if the loss is.
he is guilty after that the loss will be birthed by this individual fine.
in situation blunder is there by he or she clear otherwise typically the whole loss.
will be birthed by the capital carrier this is what Mudaraba contract is easy.
collaboration all right currently let” s see another one currently. you can stop briefly the video and take this note if you like yeah or else just.
continue now here we have the second form of.
agreement see below Musharaka now Musharaka is also exact same like.
mudaraba only yet there allow differences so see here.
it” s a joint business or collaboration structure yeah very same like Mudaraba.
only where at the very least 2 parties or more yeah that” s the important things below the. events can be much more also in mudaraba we saw there will certainly be just. two parties right one rab-al-maal the finance service provider and.
one the labor provider Mudarib yet here it” s
not. like that here the celebrations can be extra yeah numerous parties can be there.
yes so see below numerous events can be there they will bring their resources as.
well as abilities bring resources and abilities and everybody.
are working partners yeah or they desire they can be resting.
partners yet everybody can be what they can be working partner they.
can take part in the management of business.
all right and these individual the partners they are called as.
musharrek in this agreement fine musharik everyone are musharik.
musharik musharik musharik great everybody can join.
management currently the primary distinction right here is if there is a.
revenue after that the revenue will be dispersed in the.
pre-decided proportion all best whatever they determine in the beginning itself.
After that if there is a loss after that the loss has to be purely it has to be.
distributed in the resources ratio fine whatever resources.
they generated that proportion just the loss will certainly be.
shared among them construct amongst them all right so this is what Musharaka is okay.
the primary distinction is the loss difference in the mudaruba.
in the mudrabah we saw the loss is totally birthed by the money service provider.
yeah but right here the money is supplied by everybody.
so what will certainly take place right here is that the loss will be.
dispersed in the capital ratio of the mushariks the companions.
clear and one more distinction was that every person are functioning companion over right here.
every person can take part in administration however below.
just the the skill supplier the supervisor he” s the supervisor right’he ‘
s just. getting involved here in mudaraba in mudaraba I mean yeah.In Musharaka
below everybody can take part in the.
management of the company clear so this is what Musharaka is simple very easy.
now let” s relocate on to the 3rd agreement you recognized ideal Musharaka nothing.
it” s straightforward and afterwards we have actually sukuk now what are.
sukuk? sukuk are the islamic bonds you recognize the bonds that are structured in.
such a means as to create returns to financiers.
without infringing islamic regulation that prohibits interest currently usually.
conventionally what takes place yeah regular bonds exactly how are they? when the.
business problems bond the traditional bonds after that.
they pay passion on them to the bond owners right if you have actually bought the.
bonds that means you are obtaining passion from them.
yeah you as an investor if you have bought any type of bonds after that you will be.
receiving rate of interest from the company which has actually released the.
bonds isn” t it yes that ‘ s what traditionally typically takes place but here. in islam interest is totally forbidden. interest is not permitted so if rate of interest is not allowed after that how.
can bonds work that” s what you need to consider all.
right so here the bonds are structured in such a way.
to generate go back to financiers without infringing islamic legislation that restricts.
passion rate of interest can” t be there in these bonds in this these bonds. interest are not there yet capitalists are obtaining returns. how does that work allow ‘ s comprehend this see below sukuk focus on.
revenue sharing by offering the investor ownership in organization and possessions now.
allow” s take an example and understand this
see’right here. let ‘ s claim i have a company right and allow ‘ s claim this business issued. bonds yes it is must so prepare so car provided great so now allow
‘ s say you. subscribe you purchase those to cook now you will certainly be paying money
right so i” m. getting bucks i” m obtaining money so currently what i ‘ m going to do as a company. first i will certainly appoint and manager sukuk supervisor. So that sukuk manager will certainly be you know in managing.
everything associated to these bonds great so currently what the business will do is.
firm will certainly purchase an asset normally why do you raise.
financial debt money mostly to purchase possession right so what you” re going to do is you. are mosting likely to buy an asset the firm is mosting likely to buy an asset.
So now what the company will certainly do is business will certainly give you.
possession in those assets because which money is this.
this money is of bond owners you are a bondholder right why you are a.
shareholder since you have actually registered for the bonds.
the sukuk right so you will get possession of the.
property which has actually been bought from your cash yeah the cash money circulation which the.
company will certainly obtain from you yeah after releasing the bonds from that.
they will certainly purchase the asset and the possession of that property will certainly be.
provided to you to the shareholders fine so when you become proprietor of.
something yep when you become proprietor of something.
You are qualified to the advantages and risk coming out of that.
possession right so whatever earnings that will certainly be produced from that possession.
you will certainly obtain a part of that to make sure that” s how you will certainly obtain.
income from these bonds all right you will certainly not get rate of interest okay rate of interest is.
completely restricted in islam you understand that yeah but right here in sukuk.
there is an earnings sharing goal by supplying the capitalist possession in.
When you obtain the possession you are, possession right.
entitled to the benefits as well as the risk of that property.
so whatever money has been generated since of that property.
yeah a component of that will be sent out to you yeah it will be offered to you it will be.
distributed to you ideal participation in revenue that” s how you will. take part in the profit of that property yeah because you own.
it right you as a sukuk owner fine so this.
is exactly how sukuk works so unlike standard bonds sukuk are.
linked to a hidden substantial possession yeah an asset.
will certainly exist you keep in mind the what the last principle.
of islamic money wide range should be created from genuine.
trade and property based financial investment fine this is what.
it is yeah there is an underlying asset over right here you are not.
just obtaining you recognize interest no you are not getting.
rate of interest over right here you are getting revenue you are obtaining.
earnings over below from the possession based investment alright.
is that clear very easy right so this is what sukuk is.
good straightforward all right and then the 4th kind of agreement we have.
is ajara ijara resembles a lease agreement okay.
When we believe concerning leases what comes to our mind we assume about the principal.
quantity plus interest yes that” s just how
leases. works isn” t it the lessee will make payment to the lesser.
for using the property which repayment will include.
what major quantity plus interest but now right here in islam.
passion is entirely prohibited so exactly how these agreements are going to function.
yeah how is it going to function so see below that” s what we have to comprehend. an ijara deal is the islamic matching of a lease contract.
where one event lessor enables one more party lessee.
to utilize their property versus the payment of a rental fee.
now here because passion is forbidden so a fixed rental charge will certainly be.
set in between the celebrations the lower and.
lessee and that rental fee will be paid which doesn” t consist of passion it is
a. predetermined charge alright it” s not like compounding passion and all.
good yes so now allow” s understand that in quite information see right here.
right so they will make the entire repayment to the vendor. and financial institution will advise the vendor this honda showroom this supervisor. to deliver it to you okay so the vehicle will be supplied to you.
alright you will have the position of the automobile yeah and you will have to make an.
preliminary down payment to the financial institution fine preliminary some cash you need to.
pay to the financial institution for the warranty or something yeah.
but the possession of that auto will certainly continue to be with the financial institution.
all right the ownership will certainly remain with the financial institution so whatever benefits and risk.
exist of that possession of that vehicle will certainly remain with the.
financial institution itself so if there is any significant upkeep cost.
yep there” s any type of maintenance then the bank will certainly have to construct the upkeep.
expense and whatever yeah however if there” s a small upkeep. or something after that you will certainly need to construct it.
yourself today how you are mosting likely to pay to the financial institution.
you are mosting likely to pay in kind of leasings alright the services will be concurred.
in the starting itself okay predetermined rentals fine.
so you will pay the leasings and at the end of the lease duration.
yeah you will additionally make a decision the least duration additionally with the bank at the.
beginning itself so at the end of the lease period what.
will take place goes to completion of the lease duration the bank.
will offer you choice do you intend to buy the possession yeah buy.
the automobile just by making some extra additional.
repayment yeah a new arrangement will be made.
or do you wish to return the cars and truck back to the financial institution yeah.
that” s the option will be given to the to the lessee. yeah to you fine so this is what a ajara contract’is. good it ‘ s a simple agreement you comprehended this initial down payment you will. make financial institution will purchase the auto for you and. make the settlement to the this honda guy yep this manager. then this manager will supply the cars and truck to you he will provide the placement to you. The ownership will stay with the bank and bank will. you recognize financial institution will certainly be accountable for any type of maintenance cost and everything.
because the danger and incentive are with the bank.
because they have the ownership right so indeed and you will be paying routine in.
rentals to the financial institution and at the end you will be offered the alternative.
either to purchase or return the possession back clear this is what a lease contract is.
If you desire you can stop the video clip and, easy lease contract yeah.
take this down ideal all right so currently let” s proceed now right here we have.
the last the last contract of islamic money.
that you” re going to see in this video clip Murabaha the fifth agreement.
thus far we have actually covered four contracts mudaraba musharaka.
sukuk and ijara so now what is this Murabaha.
see Murabaha is nothing but just a credit history sale all right credit scores sale contract that” s.
all Murabaha is.See the meaning over here a.
Murabaha deal is a deferred repayment sale.
or an installation credit sale and is primarily utilized for the purchase of goods.
for instant distribution on credit basis.
If the goods are of hundred, currently you already understand what is installment credit scores sale.
bucks you will certainly pay 20 20 20 in installations today what is.
credit basis? deferred settlement suggests what you are.
delaying the settlement at a later date okay you will certainly pay at a.
later date that” s what deferred settlement basis is simple.
today allow” s understand just how this muraba will function.
see for instance let” s claim you need to get a property or some goods.
and you put on” t have money to buy it straight-out promptly you don” t have. sufficient cash you have some money so currently what are you.
mosting likely to do is you need to obtain right into a contract contract with the financial institution.
islamic bank obviously right so now what the financial institution will certainly do is.
bank will buy the property or the items for you.
and the bank will sell it to you at a profit margin.
for instance if the financial institution bought that property for 100.
So what the financial institution will do financial institution will include 20.
more profit 100 plus 20 a markup and sell it to you for 120 and in the.
beginning just they will be it will certainly be made a decision yeah the markup and.
everything will certainly be various made a decision at the.
starting itself it is not such as the financial institution will certainly hide any kind of regards to contract from you.
fine they will reveal whatever so it will.
not be injustice to you right and then what you need to do is.
after getting the property you need to pay in kind of installations.
alright whatever you set yeah in installations or on postponed.
repayment basis you can also guarantee them to pay at a later date.
yeah that can likewise occur indeed simple yeah this is what Murabaha.
is yeah you wish to ask it you approach to the financial institution bank will acquire it for.
you and offer it to you with a profit margin expense plus revenue.
you have to pay in form of installations or.
deferred settlement basis clear that” s what muraba. is simple is that easy so now what i” m gon na do is i ‘ m gon na add timestamps in. If you want to change or go back to any of these contracts, the video clip.
after that simply most likely to the description and see the timestamps and go back and.
view these all right great alright then see in the next video clip right that” s it for today.
If any type of deal involves passion then that” s not permitted in islamic. Currently here what will certainly happen this company either this
business service make. So that sukuk supervisor will be you recognize in handling.
So they will certainly make the entire repayment to the vendor. The possession will continue to be with the financial institution and financial institution will.