Muzn Islamic Working Capital Finance offers an ideal Shari’a compliant solution for sustaining your business’ growth.
As your company grows, working capital becomes increasingly important for sustaining business continuity. Whether you are looking for short-term financing for project completion, purchase of raw materials or for the production of goods, our Islamic solutions are flexible enough to cater to working capital requirements.
How Muzn Islamic Working Capital Finance works
Muzn’s Islamic Working Capital Finance is based on Murabaha. Under the Murabaha facility, upon your request, Muzn (or its agent) purchases goods from the manufacturer or supplier, or any other third party, acquiring the ownership, possession and risks. These goods are then sold to you on a cost plus profit basis. You can then pay the agreed Murabaha price as a lump sum, in installments, or a combination of both, as mutually agreed with Muzn.
The purpose of this facility is to provide your business Working Capital Finance to purchase all types of Shari’a-compliant goods.
Murabaha Finance distinguishes itself from conventional interest-bearing loans with the essential tenet that once the selling price is determined, it cannot be changed.
Basic Conditions of Muzn Islamic Working Capital Finance
- The subject asset(s) of sale must exist at the time of sale. Thus, anything that may not exist at the time of sale cannot be sold and its non-existence makes the contract void.
- The subject asset(s) should be in the ownership of the seller (Bank) at the time of sale. If the seller sells something that is not owned by him, the sale becomes void.
- The certainty of the cost price is a necessary condition for the validity of a sale. If the cost price is uncertain, the sale is void.
- The subject asset(s) of sale must be in the physical or constructive possession of the seller when he sells to the buyer.