IFB Brunei



1. Al-Ijarah
Al-Ijarah (leasing) involves the sale of the usufruct (the right to use the object) for a specified period of time. Technically, al-Ijarah is a contract for the transfer of ownership of usufruct for compensation.

2. Bai’ Bithaman Ajil
Bai’ Bithaman Ajil (BBA) means deferred installment sale. Through this contract, banks may finance customers who acquire an asset but wish to defer the payment for a specific period (payment by installments). Customers are allowed to settle the payment of the asset within a certain period of time.

3. Mudharabah
Technically, mudharabah is a partnership in profit whereby one party (rabbul mal) provides capital and the other party (mudarib) provides labour.

4. Murabahah
Murabahah is defined as selling a commodity as per the purchasing price with a defined and agreed profit mark-up. This mark-up may be a percentage of the selling price or a lump sum.

5. Musharakah
Musharakah is an agreement between two or more parties to combine their assets, labour and liabilities for the purpose of making profit in providing protection and compensation to the Participants who suffered from perils and hazard.

6. Takaful
Takaful (Islamic insurance) is an Islamic concept joint guarantee, whereby a group of participants agree to mutually guarantee each other against a defined loss. In the context of Islamic insurance, takaful refers to an arrangement for mutual indemnity

7. Tawarruq
Tawarruq (Monetization) is another concept of financing that potentially replaces the controversial concept of al-Inah. Tawarruq refers to buying a commodity with deferred payment and selling it to a person other than the buyer for a lower price with immediate payment

8. Wadiah Yad Dhamanah
Wadi’ah yad dhamanah is one of the types of wadi’ah. Hanafi schools defined wadi’ah as an empowerment to someone to keep the owner’s property explicitly or implicitly. On the other hand, according to Shafi’e and Maliki Schools, wadi’ah is a representation in keeping position or respectable private goods in a specific way.

9. Wakalah
Wakalah is an agency contract in which one party gives the other party the mandate to become the representative in performing a particular task. In the context of Islamic finance, the client will usually appoint the financial institutions to become his agent in carrying out a muamalah transaction and in return, the financial institution will receive a fee for the service.