Mudarabah Contract (or Mudaraba) - Meaning, Definition & Example - AIMS Education

Murabahah is a type of Islamic financing where the bank purchases an asset on behalf of the customer and then sells it to the customer at an agreed upon price, which includes a profit margin for the bank. This type of financing is often used for the purchase of homes, cars, and other big-ticket items. The investor in mudaraba is known as Rabb-ul-maal, the person who manages the firm is known as the mudarib, and the investment is known as 'raas al-maal.' Mudarabah is extensively used in Islamic finance to structure bank deposit accounts, as well as with other Islamic financial contracts.

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