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Islamic Finance

  Islamic Finance   |   Terms
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  • April 2, 2022
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Sharikat al-Mufawadhah

Arabic (شركة المفاوضة) for a subset of sharikat al-aqd  (contractual partnership) that constitutes a contract between two or more persons with each contributing a portion of the total capital (ras al-mal) and participating in work and management.

Partners receive their respective profit or loss shares according to equal ratios. Both Hanafis and Malikis considered this type of partnership valid and permissible, but only subject to a set of restrictions.


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