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| Management of Deposit
Schemes |
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Deposits shall be managed
under the Mudaraba arrangement, under which customer is the Rabb-ul-Maal
and bank is the Mudarib. Bank, being the Mudarib, shall be responsible
for placing the funds in secured as-well-as profitable Islamic ventures
on the basis of Ijarah, Murabaha, Mudaraba, etc and shall share a portion
of profits as a compensation for its efforts. The profit sharing ratio
shall be announced at the beginning of month. Rabb-ul-Maal, on the other
hand, shall earn the net profit after all deductions, and this total earning
of the Rabb-ul-Maal shall be shared by the individual depositors on the
basis of weightages, which shall be announced at the beginning of the
month. In the event of loss, Mudarib would lose its profit share which
otherwise would have been paid to it in the cases of profit, and Rabb-ul-Maal
shall bear the net loss. |
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| How is the return Halal
? |
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Care would be taken in
ensuring that both the arrangements of accepting deposits from customers,
and investing that amount in Islamic Modes of Financing, are done in a
strictly Shariah-compliant manner. On the basis of approval from reputed
Shariah scholars, who belong to Internationally renowned university for
Islamic education, products have been designed to not only suit the needs
of depositors/ borrowers but also remain strictly in compliance with Islamic
Shariah. Moreover, our Shariah Advisor, Dr. Maulana Muhammad Zubair Usmani
would also monitor our transactions on a daily basis.
Elements of Riba have been eliminated completely from
the contracts so that income earned through investments in assets is completely
halal and is shared by the depositors in a Shariah-compliant manner. A
transparent system of weightages is used to calculate the profit rates
on the basis of which profits are disbursed to each customer. These weightages
are announced by the bank at the beginning of each month/ term and posted
on the Notice Boards of Islamic Banking Branch as well as on our website. |
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| Diminishing Musharakah |
| Difference
between Diminishing Musharakah and a Term Loan |
|
In Diminishing
Musharakah the relationship between the bank and the customer is that
of co-owners in an Equipment and not one of lender-borrower |
|
|
The initial financing
provided by the Bank is applied to acquire a share in the Equipment and
not to provide a loan |
|
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The customer’s
monthly acquisition is for acquiring the bank’s share in the Equipment,
whereas portion of rental is for the customer’s exclusive use of
the whole Equipment |
|
|
These payments do not
constitute a repayment of a loan with interest since it does not involve
an exchange of cash for a greater amount of future cash |
|
|
Diminishing Musharaka will comprises of three
agreements. |
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Co ownership Agreement between bank & client |
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Lease Agreement between bank & client |
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Unit Purchase agreement |
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| Bank’s
share in any gain or loss that may result from a sale of the Equipment |
|
In case of destruction,
if the Equipment is beyond repair and insurance proceeds are short to
cover are total O/S, MCB and customer will bear the risk as per their
proportion of ownership |
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| The bank
as a co-owner on the title of the Equipment |
|
The bank has charge over
assets of the company |
|
Bank’s ownership
in the asset vests by way of the Musharakah agreement |
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| How to make Deposits in
these schemes ? |
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All that shall be required
to do to deposit funds with us is to fill in the form, and pay us through
any mode convenient to the customer i.e. Cash, Cheque, or Pay Order in
favor of MCB Bank, Islamic Banking Branch. Funds may be deposited at Islamic
Banking Division’s branch, or at any of the authorized MCB branches
. For further details, customers may send email to us on infoislamic@mcb.com.pk
or log on to our website www.mcb.com.pk/islamic_banking. |
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