cost-plus sale (مرابحة) and financial leasing may sometimes produce numbers that look similar to conventional finance, but their legal structure is different.
In cost-plus sale (مرابحة), the financier actually purchases and owns the commodity before selling it, and the agreed sale price does not increase merely because payment is delayed. In leasing (إجارة), ownership risk remains with the lessor where the lessee is not at fault.
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The Foundations of Islamic Economic Thinking
cost-plus sale (مرابحة) and financial leasing may sometimes produce numbers that look similar to conventional finance, but their legal structure is different.
In cost-plus sale (مرابحة), the financier actually purchases and owns the commodity before selling it, and the agreed sale price does not increase merely because payment is delayed. In leasing (إجارة), ownership risk remains with the lessor where the lessee is not at fault.