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What is Understanding Mudarabah Agreements about?

Mudarabah is a partnership agreement where one party provides capital (Rabb-ul-Maal) and the other manages the business (Mudarib). The rules dictate that profits are shared according to a pre-agreed ratio, while losses are shared in proportion to the capital invested. The agreement can be terminated by either partner with notice, and specific conditions apply regarding management rights and asset distribution.

Author

Faroq Omar

Language

EN