| A-E, F-L, M-P, Q-S, T-Z |
| Qard
al hasana |
| A
virtuous loan. A loan with the stipulation to return the principal
sum in the future without any increase. |
| Qard
Hassan |
| An
interest-free loan given for either welfare purposes or for
fulfilling short-term funding requirements. The borrower is
only obligated to repay back the principal amount of the loan. |
| Qard
Hasan (Interest free loans) |
|
Most
of the Islamic banks also provide interest free loans (Qard
Hasan) to their customers. If this practice is not possible
on a significant scale, even then, it is adopted at least
to cover some needy people. Islamic view about loan (Qard)
is that it should be given to borrower free of charge. A person
is seeking a loan only if he is in need of it. Hence, it is
a moral duty of the lender to help his brother who may be
in need. The borrower should not make an effort to take advantage
of somebody needs. He should help the needy by lending him
money without any charge. The reward of this act is with the
God. Hence, it is referred as Qard Hasan (benevolent loan)
which signifies the benevolent nature of the act of lending.
The
practices of various Islamic banks in this respect differ.
Some Islamic banks provide the privilege of interest free
loans only to the holders of investment account with them.
Some extend to all bank clients. Some restrict it to needy
students and other economically weaker sections of the society.
Yet some other Islamic banks provide interest free loans to
small producers, farmers and entrepreneurs who are not qualified
to get finance from other sources. The purpose of these loans
is to help start them their independent economic life and
thus to raise their incomes and standard of living.
|
| Qard
Hasan |
| An
interest-free loan given mainly for welfare purposes. The borrower
is only required to pay back the amount borrowed |
| Qimer
|
| Lit:
gambling. Technically, an agreement in which possession of a
property is contingent upon the occurrence of an uncertain event.
By implication it applies to those agreements in which there
is a definite loss for one party and definite gain for the other
without specifying which party will gain and which party will
lose. |
| Qirad |
| Mudaraba |
| Rab-al-maal
|
| In
a mudaraba contract the person who invests the capital. |
| Rabbul-mal
|
| Owner
of Capital |
| Riba |
| Lit:
an excess or increase. Technically, an increase, which
in a loan transaction or in exchange of a commodity, accrues
to the owner (lender) without giving an equivalent counter value
or recompense in return to the other party. It covers interest
both on commercial and consumer loans. |
| Riba
|
| This
term literally means an increase or addition. Technically it
denotes any increase or advantage obtained by the lender as
a condition of the loan. Any risk-free or "guaranteed" rate
of return on a loan or investment is riba. Riba,
in all forms, is prohibited in Islam. In conventional terms,
riba and "interest" are used interchangeably. |
| Riba |
| Literally,
an increase or addition. Technically it denotes in a loan transaction
any increase or advantage obtained by the lender as a condition
of the loan. In a commodity exchange it denotes any disparity
in the quantity or time of delivery. |
| Riba
al-buyu |
| A
sale transaction in which a commodity is exchanged for the same
commodity but unequal in amount and the delivery of at least
one commodity is postponed. To avoid riba-al-buyu,
the exchange of commodities from both sides should be equal
and instant. Riba-al-buyu was prohibited by the
prophet Mohammad to forestall riba (interest) from creeping
into the economy from the back door. |
| Riba
al-fadl |
| Usury
of trade. It is an alternative term for riba al-buyu.
|
| Riba
al-diyun |
| Usury
of debt. |
| Riba
al-nasia |
| Increment
on the principal of a loan payable by the borrower. It
refers to the practice of lending money for any length of time
on the understanding that the borrower would return to the lender
at the end of this period the amount originally lent together
with an increment in consideration of the lender having granted
him time to pay. The increment was known as riba al-nasia.
It was in vogue in Arabia in the days of the Prophet Muhammad.
|
| Ruq'a |
| Banking
instrument of the early Muslim period. It was a payment
order to draw money from the bank. |
| Sadaqah |
| Charitable
giving. |
| Shari'a
|
| The
way of Allah as shown by the Qur'an and the Sunnah of
the Prophet Muhammad. The term is used to refer to the Islamic
law. |
| Sharia |
| Islamic
law derived from three sources - the Quran, the Hadith, and
the Sunnah. |
| Shariah |
| Islamic
cannon law derived from 3 sources: the Quran; the Hadith (sayings
of the Prophet Muhammad); and the Sunnah (practice and traditions
of the Prophet Muhammad). |
| Shirkah |
| A
contract between two or more persons who launch a business or
financial enterprise to make profit. |
| Shirka
|
| Musharaka
|
| Suftajal
|
| A
type of banking instrument used for the delegation of credit
during the Muslim period, especially the Abbasides period.
It was used to collect taxes, disburse government dues and transfer
funds by merchants. It was the most important banking
instrument used by traveller merchants. In some cases
suftajahs were payable at a future fixed date and in
other cases they were payable on sight. Suftajah is
distinct from the modem bill of exchange in some respects.
Firstly, a sum of money transferred by suftajah had to
keep its identity and payment had to be made in the same currency.
Exchange of currencies could not take place in this case.
Secondly, Suftajah usually involved three persons.
'A' pays a certain sum of money to 'B' for agreeing to give
an order to 'C' to pay back to 'A'. Third, a Suftajahs
could be endorsed. The Arabs had been using endorsements
(hawala) since the days of the Prophet Muhammad.
|
| Sallallahu
alaihi wassallam (SAW) |
| This
is a salutation used by Muslims whenever referring to the Prophet
Muhammad. It is abbreviated as 'SAW'. It means 'peace
and blessings of God be upon him'. |
