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Ref: tij012/08 March 2008 Q: I want to buy some goods for selling. I do not have money to purchase the goods. I wish to borrow the money from another person to pay for the goods. In turn, I wish to pay the person from whom I have borrowed the money in 6 months time. This person naturally expects a profit. Please advise me as to the types of contract we can enter into ? A:  There are a few practical methods in which you could structure your transaction. - The person who has the necessary finance could purchase the goods at a cash price and after taking possession of them could sell them at a higher but fixed credit price payable over terms (for e.g. after six months).
If only the other person is providing the finance and you will be doing the work, you may enter into a Mudhaaraba transaction in which you stipulate at the outset that you will share the profits at a certain pre-agreed ratio. If there is a loss, the financial loss will be borne by the financier and your loss will be that you will not get any fruits for your work.
Alternatively you both may contribute financially in any agreed proportion to the purchasing of the goods and agree upon any profit sharing ratio which need not be commensurate with the proportion of capital investment. In other words even if the capital invested is 80:20, profits could be shared 60:40 or in any other proportion that is mutually agreed upon. However, loss will always be borne according to capital contribution.
Mufti Shafiq Jakhura Iftaa Department, Darul Ihsan Islamic Services Centre I concur with the answer: Mufti Zubair Bayat Ameer, Darul Ihsan Islamic Services Centre
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Fatawa Q & A 
