Mudaraba: pillars and conditions

The mudaraba, also called qirad or muqarada, is a contract by which the owner of a capital (rabb al-mal) entrusts it to a worker (mudarib) so that he may trade with it, the parties sharing the profit according to a stipulated clause while loss falls on the capital alone. The jurists of the four schools have laid down its conditions concerning the form of the contract, the two parties, the capital, the profit and the work. This chapter sets out these rules and their differences, according to the classical sources of each school.

Parts of this section

• The Form of the Contract: Offer and Acceptance
• Profit Reserved to the Two Parties