 Group name

Im|Challenger
 Group leader
Maham Tariq
 Group writer
Usman Bashir
 Group Members
Abdul Qader
Asghar
Ibrahim
Umar khan
 Tran slati on:
 While others travel in the land in
search of Allah's bounty (Chapter 73,
Verse 20)
 Introduction of Mudarbah
 Origin
of word Mudarbah
Taken from the Arabic word ‘Al-Zarb’
which mean traveling
Definition
Two are more than two persons
enter into a deal in which
one party provides capital
and the other party conduct
the business with this
capital under an agreement
of receiving a fixed share
in the profit.
Ancient form of business practiced by
Arabs before Islam
Muhammad and Hazrat Hudija
also
did the Mudaraba business in which
Muhammad
was the Mudarab and Hazrat Hudija was
Rab ul mal
 Party in Mudaraba

“Rabal-maal” (financer)

“Mudarib”  
(entrepreneur)
 Types of Mudaraba
 Al-mudarabah al-muqayyadah
(restricted mudarabah): where rabb-
ul-mal specifies a particular business
for the mudarib, in which case he
shall invest the money in that
particular business only.
Al mudarabah al muttaqah
(unrestricted mudarabah): where
rabb-ul-mal leaves the door open
for the mudarib to undertake
whatever business he whishes,
the mudarib shall be authorized
to invest the money in any
business he deems fit.
 One to one
 One to more than one
 More than one to one
 More than one to more than one
Basic Rules of Mudaraba

Two or more persons, of their own free

will, should enter into contract whereby
one party provides a specified amount of
capital to the other who employs this
capital in business to make profit.
Basic Rules of Mudaraba
The Nature Of the Capital

The capital should

be in terms of
gold or silver
coins or standard
money in
circulation or
commodities
 Basic Rules of Mudarabah
Distribution of Profit

Share of each party in

the profit should be
clearly defined in
definite ratio or
percentage
 Sharing of Loss

Loss should be
solely suffered by
the owner of
capital, unless such
loss is caused by
the negligence of
the Mudarib.
 Management and control
The Mudarabah business
should be operate
and run by the
Mudarib
 Form of business
The Mudarab is absolutely free to
trade or do businesses with the
capital as he deems fit. Any condition
limiting his freedom may render the
contract invalid.
 Right and duties of
Mudarabah
 Itis essential for the Mudarib to follow all
the rules
 Mudarib is free to enter in a contract with
other party
 Rab ul mal can not take an active part in
business with the Mudarib
 The Mudarib has no power to lend or gift
the capital
 Duration of Contract
 windup of contract should be on both
willingness
 The contract can be made for
specified or indefinite period
 The contract is terminated by death
of one party but…
 Application of Mudaraba
 To divert towards Islamic tools of
financing because the conventional
financial system is greatly
inconsistent with Islamic teaching.
 Mudaraba in join stock companies