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Islamic Finance

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  • August 5, 2020
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Constant Musharakah

A type of musharakah (establishing a sharikah) in which the partners’ shares in the sharikah capital don’t change throughout the musharakah tenor. Rather, the shares remain constant, with each entitling its respective partner to his/ her share in profits (and associated liability for losses, if occurred) according to the terms set out in the contract (aqd).

For example, if three partners agreed at the contract date that their contribution percentages are 30%, 30%, and 40%, then, these percentages will be constant and can’t be changed over the contract life.


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