Financing products (debt-based): Murabahah & Tawarruq

Financing products (debt-based): Murabahah & Tawarruq

Multiple Choice

The following contracts are considered as debt-based financing in Islamic finance EXCEPT

• Murabahah

• Dayn

• Mudarabah

• Tawarruq

Multiple Select

In a Murabahah contract, what are the elements that must be disclosed to the contracting parties?

• cost price

• profit sharing ratio

• profit portion (markup)

• loss bearing ratio

Multiple Choice

Other requirements of a valid contract do not apply to the Murabahah contract, only the specific conditions that must be fulfilled for the murabahah contract to be valid.

• True

• False

Multiple Choice

The Murabahah contract that is widely applied by IFI as financing tool and includes prior unilateral promise to buy refers to which type of Murabahah?

• ordinary Murabahah

• Murabahah to the purchase orderer (MPO)

• restricted Murabahah

• unrestricted Murabahah

Multiple Choice

Based on the modus operandi of Murabahah (vehicle financing), determine which step depicts the Murabahah (cost + profit) sale?

• step 1

• step 2

• step 3

• step 4

• step 5

Multiple Select

In the event of default or early settlement of debt in a Murabahah contract, which of the following statement is true?

• Islamic banks may give rebate (ibra’) to the customer

• customer no longer enjoys the deferment in payment because the debt is settled on the spot

• rebate (ibra’) is given on the unearned profit portion

• rebate (ibra’) is given on the unearned cost portion

Multiple Select

In the event of default, Islamic banks

• may impose a compensation charge (ta'widh) that shall not exceed the actual financial loss

• may impose penalty for late payment charges

Multiple Select

The imposition of compensation (ta'widh) and gharamah (penalty) by Islamic banks needs to be implemented with certain conditions laid out by BNM. Which of the following statement is FALSE?

• IFI may recognize compensation (ta'widh) as income

• IFI cannot recognize compensation (ta'widh) as income

• IFI may recognize gharamah (penalty) as income

• IFI cannot recognize gharamah (penalty) as income

Poll

Can Islamic banks or IFIs use interest rate as a benchmark determining their profit rate?

• Yes

• No

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Multiple Select

Profit based on interest rate should be prohibited just as interest itself. This is the opinion of those who

• oppose the use of interest rate as benchmark in Islamic finance

• approve the use of interest rate as benchmark in Islamic finance

• criticize the use of interest rate as benchmark in Islamic finance

Fill in the Blanks

Those who allow for interest rate benchmarking does not render the contract invalid or prohibited because the contract does not contain

Multiple Choice

Bai Bithaman Ajil means sale of goods with .......... payment

• deferred

• immediate

• spot

• future

Fill in the Blanks

The common term used in the market today to denote Tawarruq is

Multiple Select

Which of the following is NOT considered as types of Tawarruq?

• Tawarruq on individual basis

• Tawarruq on company basis

• organized Tawarruq

• unorganized Tawarruq

• Banking Tawarruq

Multiple Choice

Based on the modus operandi of Tawarruq, determine which steps that illustrate - the bank sells it to the customer at a cost-plus price (murabahah) on a deferred basis

• 1

• 2 & 3

• 4 & 5

• 6 & 7

Multiple Select

Which of the following authority approved the Tawarruq transaction?

• OIC Fiqh Academy

• AAOIFI

• SAC of BNM