AAOIFI: a Murabaha requires genuine ownership and possession
AAOIFI — Accounting and Auditing Organization for Islamic Financial Institutions
What this source says
AAOIFI's Shariah Standard on Murabaha (Standard No. 8) requires that the institution actually acquire and own the asset, taking either physical or constructive possession and thereby bearing genuine ownership risk, before it may sell that asset on to the customer at a disclosed cost-plus markup. An institution cannot validly sell what it does not yet own; a transaction in which the bank never assumes real ownership risk fails the substance the standard demands, regardless of its paperwork.
Wording inside quotation marks is quoted from the source. The rest is this notebook’s summary of it — read the original before relying on it.
Provenance
- Source
- AAOIFI Shari'ah Standard No. (8): Murabaha
- School / basis
- Comparative
- Added
- 2026-06-03
- Trust
- A position recorded from a named, published source — reported accurately, not independently adjudicated.
Compiler’s note
Paraphrase of the documented standard (not a verbatim quote of the standard's text). Used to test whether a 'Murabaha' product is real or a synthetic-loan hiyal.
Topics
islamic-financemurabahaownershipstructuresstandards
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