Management Notes

Reference Notes for Management

Ijara Questions With Answers – 15 Q & A | Islamic Banking and Finance

Ijara Questions With Answers

Ijara Questions With Answers

1. What is Ijara in Islamic finance?

Ijara is an Islamic financial concept that involves leasing or renting assets, typically real estate or equipment, in a Sharia-compliant manner. In an Ijara transaction, one party (the lessor) leases an asset to another party (the lessee) for an agreed-upon rental payment.

The lessee uses the asset while paying rent, and at the end of the lease term, they may have the option to purchase the asset at a pre-agreed price. Ijara adheres to Islamic principles, such as avoiding interest (Riba) and ensuring that the transaction is based on a real and tangible asset.

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