Islamic Loan

Islamic Loan

A loan that interest cannot be charged on. Instead, the loan is structured using discounts, sale or lease, profit participation, or repurchase agreements.

Islamic Loan

Any form of financing made according to Islamic law, which forbids the payment or receipt of interest. An Islamic loan may be an interest-free loan, but often it is a more complex transaction. For example, a bank could buy an asset for cash and then re-sell it to the "borrower" for a profit such that the profit is the same as the bank would have made had it extended a regular loan. Other types may involve the bank becoming a partner with the "borrower" so that both co-own the asset or business that the loan finances, and the borrower gradually buys the bank's share of ownership with a series of payments. Strictly speaking, most Islamic loans are partnerships or joint ventures, but they are called loans because they accomplish much the same thing as conventional loans. See also: Islamic finance, Murabaha, Mudharaba, Musharika.
References in periodicals archive ?
In June, Zain Saudi Arabia signed a 2.25 billion Saudi riyals (Dh2.2 billion) Islamic loan to refinance an existing facility with the Commercial and Industrial Bank of China.
The ECC had recommended a revised term sheet as agreed upon by the Mandated Lead Arrangers and Power Holding (Pvt) Limited and signed on January 16 besides that out of the Islamic loan being raised, payments are made in such a manner that substantial funds flow to PSO through various generation companies/power producers in addition to payments of RLNG.
The firm's debt problems stem from a $325 million Islamic loan restructuring signed in June 2015 and was provided by a group of banks including Noor Bank, Barwa Bank as well as Ajman Bank, United Arab Bank and Qatar Islamic Bank.
Saudi-based developer, Fawaz Abdulaziz Alhokair, has said that his firm, Arabian Centres Company, has sourced an Islamic loan.
Here are some of the most prominent Islamic car financing banks, which are providing services to the customers under the terms and conditions of Islamic loan system.
Saudi Binladin Group (SBG) has requested a second extension on a $218m (SAR817m) Islamic loan being used to fund construction at the kingdom's Grand Mosque, sources told Reuters .
Emaar the Economic City rose 2.2 percent after it said an affiliate had obtained a SR2.7 billion ($720 million) Islamic loan from banks to finance the second phase of building King Abdullah Port.
Summary: Jebel Ali Free Zone (JAFZ) made an early repayment of its AED 2 billion (US$ 544.6) Islamic loan facility to banks nearly four and a half years ahead of scheduled maturity in June 2020.
Jebel Ali Free Zone has made an early repayment of its Dh2 billion Islamic loan facility to banks nearly four-and-a-half years ahead of its scheduled maturity in June 2020.
Sunrise Properties has secured a AED515 million (US $140.2 million) Islamic loan for the development of a luxury hotel project, it was announced on Tuesday.
Summary: State-owned firm says first loan is worth $7 billion in US dollars while second is $3-billion Islamic loan in Saudi riyals.
Kuwait Finance House (KFH) on Wednesday has revealed in a statement that its arm in Turkey - Kuveyt Turk - has been successful to raise a dual-currency syndicated Islamic loan of $350 million.
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