Instead of interest, financing is priced as a disclosed cost-plus sale (murabaha) and deposits share in the profit of the investment pool (mudarabah). Late-payment amounts go to a charity fund rather than income.
How it works
- 1Set up murabaha financing products
- 2Set up mudarabah deposit pools and profit-sharing ratios
- 3Set up the charity fund for late-payment amounts
- 4Distribute pool profits each period