Kafalah (Guarantee)

• Bank provides a guarantee on the performance of the customer for a pre-determined fee / service charge. Terms for the condition for the guarantee are negotiable and must be agreed between the customer and the Bank.

Common Usage : Bank Guarantee

 Takaful (Mutual Assistance)

• A contract where community funds (contributors) are pooled and invested in an economic activity for the purpose of safe-guarding the well-being of the contributors. A maturity period is attached to the investment, where the contributor’s fund is disposed and profits (if any) is realised, and shared with the contributor. Also provides protection to contributors by a donation (assistance) to alleviate hardship in events of death or permanent injury before the maturity of the investment.
• Currently operated as either a Mudharabah (Profit Sharing) Takaful (administrative fees deducted from the Takaful books, but profits are shared), or Wakalah (Agency) Takaful (administrative fees deducted from the policyholders funds who are entitled to all returns).

Common Usage : Islamic Insurance

 Bay Al Dayn (Sale of Debt)

• Following a sale or purchase of an asset, a bill of exchange is created by the asset seller on the buyer’s commitment to pay the selling price at a maturity date. The seller has the option to wait until maturity to collect the debt (realise full maturity value) or sell the debt in the secondary market at a discounted price. The ownership of the debt is now transferred to the purchaser of the debt. The amount payable upon maturity is fixed at the original agreed price.

Common Usage : Islamic Bills of Exchange

 Wakalah (Agency)

• For the distribution of third party products with earning of sales commission / fee income, the bank is entitled to the commission as a form of agency fee.The bank acts as an agent to distribute the third party products.

Common Usage : Services (Distribution of Structured Investment, Unit Trust Sales, Bancatakaful)

 Ujrah (Service Compensation)

• Predetermined changes for banking services such as statement generation, account inquiry, cheque book issuance, ATM charges and charges for early account closure.

Common Usage : Banking Services, Underwriting fees