NEW MUSHĀRAKAH MODEL IN MANAGING ISLAMIC INVESTMENT

• Published in: ISRA International Journal of Islamic Finance
• Main Author: Jaffar M.M.
• Format: Article
• Language: English
• Published: International Shari’ah Research Academy for Islamic Finance (ISRA) 2010
• Online Access: https://www.scopus.com/inward/record.uri?eid=2-s2.0-85168681801&doi=10.55188%2fijif.v2i2.109&partnerID=40&md5=f62b6d1ffbaa0fc8d903b54d92c29126

A mushārakah contract is a joint venture between two or more parties and the profit is shared according to the agreed profit-sharing ratio. The new mushārakah model internalises this concept and takes into account the investment of two parties, the rate of profit, as well as two profit-sharing rates. At present, this model is the only model that uses two profit-sharing rates to ensure justice in a joint venture investment. This can create opportunities to generate other Islamic investment or banking products that will attract more foreign investors who are keen on mushārakah products. Apart from this, this can initiate other researches and collaborations in Islamic banking/financing and investment, thus enhancing the Islamic investment status. The system of the mushārakah model can definitely be commercialised. © 2010, International Shari’ah Research Academy for Islamic Finance (ISRA). All rights reserved.