What Is Commodity Murabahah?

Participation Finance Concepts 01.03.2021, 14:15 12.03.2021, 14:19
39
What Is Commodity Murabahah?

Commodity murabahah: A transaction set that allows a participation bank to purchase a commodity through murabahah that another bank with excess liquidity has purchased from any market for a cash price and then immediately sell the same commodity for cash to meet its liquidity needs. Since this transaction is an organised tawarruq by its real nature, it will not be appropriate to call it a commodity murabahah. If the party that needs the fund is a bank, since the transaction is regarded as a cash purchase and forward sales through the eyes of the funding bank, it can be called a reverse tawarruq.

Comments (0)
In order to comment, please login