Is it permissible for the owner of the capital to take guarantees from the Mudarib in an Islamic Mudarabah contract?
is a contract of trust, and the Mudarib (agent) is a trustee who is not liable except in cases of transgression or negligence. Therefore, it is impermissible to stipulate a guarantee from him, otherwise, Mudarabah would cease to be what it truly is and would become a prohibited usurious loan.
However, if the Mudarib violates the terms of the contract, or transgresses, or is negligent, then he becomes liable for the capital.
It is permissible for the رب المال (investor) to take guarantees from the Mudarib – such as a guarantor or a pledge – to secure against transgression, negligence, or violation of terms, provided that these guarantees are not enforced except when the violation is proven.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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- 134748
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- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
- Read the full ruling
- Read the full answer on Ftawy