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Islamic Ijarah involves the bank purchasing and renting an asset to the customer, with the bank responsible for ownership-related risks and rental payments starting after asset delivery. In contrast, conventional auto financing focuses on lending money without asset ownership responsibilities, with immediate payments and potential penalties for early payment. These differences illustrate that Ijarah is Sharia-compliant due to its asset-based approach, while conventional financing is interest-based.

Author

aishakhanniazi0

Language

EN