Car Ijarah Islamic Concept
In Arabic, ijarah means “to rent out something”. An Islamic bank’s Ijarah policy allows its customers to use an asset or equipment owned by the institution for a fixed period at a fixed price. Al Ijara is very similar to a leasing contract; a vehicle, home, plant, or machinery could be leased.
In ijarah, one is not permitted to earn money by lending money to others or by taking money from others. Therefore, a bank or any Muslim lending money to anyone cannot charge interest. It is permissible for an individual to rent an asset, but it is strictly prohibited to rent money. Ijarah Finance provides financing for a new or used car in a haram-free environment for Muslims.
