Shariah on Direct and Indirect Cost in Murabahah

• Main Authors: Mat Isa, Mohd Pisol, Ibrahim, M Yusof, Mohd Hashim, Hezlina
• Format: Citation Index Journal
• Published: 2011
• Subjects: HG Finance; BP Islam. Bahaism. Theosophy, etc
• Online Access: http://eprints.utp.edu.my/6090/1/paper_Shariah_on_Direct_and_Indirect_Cost_in_Murabahah.doc.pdf; http://eprints.utp.edu.my/6090/

Abstract: Murabahah contract is an unconditional contract of sale between the seller and buyer, where the goods, cost price, markup and payment date are clearly defined, agreed and documented. The important element is that the price in murabahah should be mutually agreed upon based on the cost and margin. This paper aims to discuss the above costs (direct and indirect) from shariah point of view and recommend the opinion which can be applied in modern murabahah transaction. This paper is a concept paper where the data from the views of shariah was gathered regarding to cost used in trading and comparison with the conventional financial cost has been made to show the direct and indirect cost in murabahah financing is accepted on unaccepted by the Shariah. The study found that the direct and indirect cost in murabahah financing is accepted by the Shariah, however it is only recommended for the cost which contributes to the product