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Is it permissible to name the Murabaha contract "financing"?

1 min readAlso available in العربية

Contracts must be called by their true names, especially if the naming leads to an illusion of a sharia-forbidden act or deception, such as calling murabaha a loan or a usurious loan murabaha. As for calling murabaha financing, there is no harm in it, because murabaha is often used to finance the purchase of something whose price a person does not possess in cash, and this is permissible provided that the murabaha is real.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

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