View source for Analysis of Islamic Financial Instruments in Terms of Microf




== Top 20 FREQUENT WORDS ==
ijara 21
islamic 18
microfinance 17
sukuk 17
asset 16
ownership 16
assets 15
underlying 14
economic 11
rent 9
contract 8
risk 8
poverty 7
based 6
financial 6
introduction 6
lessee 6
lessees 6
transfer 6
contracts 5
crops 5
finance 5
musharika 5
payment 5
rates 5
salam 5
sale 5
sharing 5
usage 5
utility 5
utilized 5



== DOCUMENT KEY POINTS ==
*in the name of allah god the compassionate the merciful there is no deity except allah and muhammad is the messenger of allah o my sustainer open up my heart sadr to thy light
*so that people may understand what i say so that they might fully understand my speech

*brief introduction the current times growing poverty levels a c worldwide financial crisis a lending and investment streams at international levels are also drying up or are already dried up
*a c problems of conventional microfinance lenders ngo in pakistan a c islamic financealternate resource mobilizing techniques in reaching out to the poor of the society

*a artificial credit expansion and speculation does not take place a c the islamic principles call for leniency towards the downtrodden and economically distressedpro poor a it follows a risk based reward system and assetbased system of economic transactions which ties monetary growth to real economic growth
*brief introduction islamic finance a c by practicing the principles of islamic finance the financial and real sectors are aligned

*brief introduction islamic finance a c in addition it does not consider money as capital a c it detests mere ownership of money as the reason for earning a reward in the shape of interest
*this it terms as the root cause of injustice and extortions in the society

*for transportation on rent a c in the current islamic banking ijara h used as a mode of financing for acquisition of assets through periodic payments of the principal value of the commodity and the rent accruing for the usage of the commodity by the lessee
*ijara h a c originally ijara h was not meant for transfer of ownership of the underlying asset a c the mechanism was useful for giving a long term durable usable commodity or a horse mule etc

*ijara h s utility benefit access to usage of capital items the nature of risk of loss will change from a credit risk to either no risk especially in immovable capital asset like land or building or risk of loss to movable capital
*this risk can be minimized too if gradual transfer of ownership to the lessee the next step

*underlying asset ijarah lease of the underlying asset its underlying assets price gradually paid to investors lessees payments made to purchase the underlying asset sukuk retirementmaturitya
*step ii diminishing musharika contract for transfer of ownership nature of relationship changes from lessee lessor lease rentals form periodic ijara h rentals to joint owners till all amount paid by the client

*however these are not speculative as no shorta selling spot contracts undertaken at the market spot price agreed among the two parties at the time of commencement of the contract
*salam istisna a exceptional forward contract allowed by the holy prophet mohammad pbuh in order to facilitate the poor farmers and traders

*sukuk another very effective mechanism though grossly distorted in practice sukuk are ownership scrips represent undivided ownership in underlying assets
*sukuk enable financing following the principle of sharing risk and return related to identifiable tangible underlying assets usufructs and projects

*ownership title in the shape of sukuk scrips held sukuk investors owners of assets donors can free themselves from the capital investment investment in underlying assets lease rentals form periodic sukuk payments underlying tangible asset a
*dissolution of sukuk contract and sale of assets to lessees intending buyers

*lessees contract basis musharika entity as originators users toll tax payers and issuers project assets a
*contribution in a rent toll tax one time payment cash long term sukuk a

*a similarly with inflation at least most of the underlying assets prices would not be decreasing and the owner of capital goods will not suffer any loss if the microfinance financial institutions are able to get funds on easy terms they should pass over the benefit to the lessees
*save the lessee from escalation in rent due to changing interest rates during times of rising interest rates currently the international lending rates too are getting more and more reduced however the cost of living is not reducing but increasing at least in pakistan

*this local asset can be indigenous land for cultivation a building already available and most importantly the indigenous people with indigenous traits and skills who become economically productive and useful for themselves as well as the rest of the world which buys their unique hand made or partly machine a made customized items which would not have been available for sale without the economic support
*combining your capital with local asset a another advantage of ownership a based resource mobilization appears in the form of utilizing the available cash resources in combination with a local asset in order to generate economic activity

*resource sharing providing long term sustenance a c denying the due share to resources and access to opportunities can cause a major damage which no amount of microfinance can repair a c risk and rewards sharing providing long term sustenance through capital based involvement create a feeling of belongingness and sharing the fruits of enterprise among the contributors of capital and contributors of human efforts
*these can be fruitfully applied for poverty alleviation at the grassroots level as well as for economic development at all levels of the society


 ''Please note, This is an auto generated summary based on sentances position in the document and other factors''
== DOCUMENT WORD ANALYSIS ==
=== Main Category ===
: AlHuda Material\islamic banking


=== KeyWords ===
contract price sale asset financing lease client purchase ijarah payment profit musharakah lessee amount commodity housing agreement contracts ownership project



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== DOCUMENT REFERENCES ==


=== Number of Pages ===
36


=== Published Date ===
2016-09-17 00:25:06


== Full Document ==


[https://www.hodhood.com/en/HodHoodDocuments/IslamicFinance/IslamicBanking/Analysis%20of%20Islamic%20Financial%20Instruments%20in%20Terms%20of%20Microf.pdf.pdf Read the Full Document]


[[Category:Islamic Finance]]

[[Category: Islamic Banking]]