Saturday, 24 September 2016

What is Murabaha used for in Islamic Banks?

Murabaha is typically used for to facilitate the short term financing requirements of the customer. The following are the uses of Murabaha:

1: Purchase of raw material, goods and merchandise of all kinds and description.
2: Purchase of equipments.
3: Import of goods and merchandise.
4: Export financing (pre-shipment)
5: Other financing of working capital nature

Presently, the majority of financing extended by Islamic banks is based upon Murabaha.

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