🏦 Murabaha Calculator
Calculate Islamic financing payments (no compound interest)
📋 Financing Details
FAQ about Murabaha Financing
Murabaha is an Islamic financing method where the bank purchases the asset (car, property, goods) then sells it to the customer at a higher price including a pre-agreed profit margin. Payment is made in monthly installments. It differs from interest-based loans because the bank actually owns the asset before selling it.
Murabaha: Bank buys the asset and sells it to the customer with a known profit. Ijara: Bank leases the asset to the customer with a promise of ownership at contract end. Tawarruq: Bank buys a commodity and sells it to the customer in installments, who then sells it for cash to get liquidity. Each has its own Sharia rulings.
Murabaha profit rates vary by bank, financing type, and duration. Typically ranges from 3.5% to 7% annually. Car financing usually 4-6%, real estate 4.5-7%, personal financing 5-8%. The rate may be fixed or variable linked to SAIBOR.
Yes, Murabaha is permissible in Islam when it follows Sharia guidelines: the bank must actually own the commodity before selling it, price and profit must be known, and there should be no excessive uncertainty. All Saudi banks have Sharia boards that review Murabaha products to ensure compliance with Islamic law.
Yes, most Saudi banks allow early repayment of Murabaha financing. Per SAMA regulations, the customer has the right to early repayment with a discount on remaining profits. Usually remaining months profit is deducted with possible early repayment fees not exceeding 3 months of profit.