It is a type of Sale contracts wherein a Seller (“Murabaha Seller”) sells a Shari’ah Compliant Asset (“Murabaha Asset”) to a purchaser (“Murabaha Purchaser”) against an agreed upon sale price (“Murabaha Price”), the seller in Murabaha shall expressly disclose to the purchaser how much cost he has incurred, and how much profit he is going to earn in addition to cost.
Murabaha price = Cost + Markup (Profit)
Islamic Banks products & services are not restricted to Muslims. Ajman Bank welcomes & will provide products & services to all customers irrespective of religious affiliations.
Shari’ah is the Islamic legal work derived primarily from the teachings of the Quran and the Sunnah (the sayings, actions, and approvals of the Prophet Muhammad, peace be upon him) and secondarily from the Ijtihad of the Muslim jurists.
Ajman Bank shall be offering savings / Term deposits accounts in AED, USD, Euro and GBP. However, current account will be offered in all major currencies.
- The conventional banks are governed by the conventional banking laws which receives money from the depositors against fixed interest rate and lends it to borrowers against interest.
- Islamic Bank is a financial institution operates within the realms of Shari’ah principles and rules. The Major prohibitions in Islamic bank’s operation:
- Prohibition of Riba (interest)
- Prohibition of Gharar (uncertainty)
- Prohibition of Gush (cheating)
Prohibition of Haram Activities (unlawful).
- A contract of sale whereby an asset (vehicle or Shari’ah compliant assets etc.) is sold at a specified price which is equal to cost plus profit.
- The bank purchasing an asset and selling it to the customer at a higher price (cost plus profit) commonly on deferred payment basis.
The bank should disclose the cost price of acquiring the subject of sale AND the markup (profit) must be disclosed as well. Murabaha contract should not lead to riba in any way.
- Murabaha price is fixed at the time of contract and cannot be altered in the future for the benefit of the Bank.
- A Personal Loan in a conventional bank is an ordinary loan where the customer borrows money from the bank and pay back the principle with interest over specific agreed tenure.
- Islamic Banks are prohibited to charged interest on financing. Personal Finance is a Shari’ah Compliant financing, based on the Islamic contract of Murabaha or commodity Murabaha. The product of Personal Finance in Islamic Banks is Riba (Interest) free.
No, Ajman Bank does not charge customers any profit on accrued profit on any finance facilities granted to customers.
The Personal Finance by Ajman Bank is a Shari’ah compliant solution which is based on the Commodity Murabaha. In Commodity Murabaha, the bank organizes the sale of a commodity between an international/local commodity market or other markets and the personal finance customer for a delay payment, the bank will sell the commodity on behalf of the customer to another buyer for cash, then the bank deliver cash to the customer.
For more information, about the structure and Shari’ahh view point please follow the below link:
(https://www.ajmanbank.ae/site/files/ISSC%20Fatwa%20-%20DMCC%20Commodity%20Murabaha.pdf)
- Interest is a pre contractually increment earned over and above the repayment of loan amount which is not permissible as per Shari’ah.
- Profit is revenue generated through various Shari’ah compliant contracts. Earning profit is permissible as per Shari’ah principles and rules.
An Islamic Bank does not earn any interest on its financings or any other activities, rather it generates its profits through entering into various Shari’ah compliant contracts like sale & purchase, leasing, construction, agency etc.
As a consequence of non-repayment, the actions taken may include the following:
(a) Negative rating in the Al Etihad Credit Bureau (AECB) or other Credit Information agency and the possible limitations on the ability to obtain financing in the future
(b) Legal Proceedings via Court
(c) Collection measures including presenting security cheques for clearing and claim on guarantees
In case additional securities in terms of pledge collaterals, guarantors, post-dated cheques etc. are obtained, these securities can be utilized or be enforced in case of
any default in payment or non-fulfillment of any terms and conditions of facility offer letter or any other signed contract.
Islamic Covered Drawing is a financing facility where the customer can utilize the funds within the executed Murabaha Limits. Customer can use the funds and the amount utilized will be automatically debited on the due date from the account.
Islamic Covered Drawings facility extended to customers is based on the Islamic Finance Structure of “Commodity Murabaha”.
For more information, about the structure and Shari’ah view point please follow the below link:
https://www.ajmanbank.ae/site/files/ISSC%20Fatwa%20-%20Islamic%20Covered%20Drawing.pdf
The profit rate is computed on a Flat Rate methodology. The profit payable by the customer is calculated based on the amount and the number of days the amount was taken for.
As a consequence of non-repayment, the actions taken may include the following:
(a) Negative rating in the Al Etihad Credit Bureau (AECB) or other Credit Information agency and the possible limitations on the ability to obtain financing in the future
(b) Legal Proceedings via Court
(c) Collection measures including presenting security cheques for clearing and claim on guarantees
In case additional securities in terms of pledge collaterals, guarantors, post-dated cheques etc. are obtained, these securities can be utilized or be enforced in case of
any default in payment or non-fulfillment of any terms and conditions of facility offer letter or any other signed contract.
Salary Advance Facility is a temporary of up to 80% of one-month net salary, that can be utilized in urgent needs of funds.
Salary Advance Facility is designed and based on the Islamic concept “Qard Hasan” contract, which refers to a concluded contract between the lender (Ajman Bank) of the money and the borrower (Customer) on Qard Hasan basis.
For more information, about the structure and Shari’ah view point please follow the below link:
https://www.ajmanbank.ae/site/files/659ISSC%20Fatwa%20-%20Salary%20Advance%20(Qard%20Al-Hassan).pdf
Salary Advance Facility can be availed every month. However, full payment for the amount availed from the facility has to be made at the end of the month one month from availing the facility.
You can apply Salary Advance Facility through Ajman Bank call center.
Auto Finance is a facility granted to customers for the purpose of purchasing a car. The ownership of the assets remains with Ajman Bank and upon complete payment of installments, the ownership is transferred on the name of the customer.
Auto Finance facility extended to customers is based on the Islamic Finance Structure of “Murabaha”.
For more information, about the structure and Shari’ah view point please follow the below link:
https://www.ajmanbank.ae/site/files/ISSC%20Fatwa%20-%20Vehicle%20Finance.pdf
No, Ajman Bank does not charge customers any profit on accrued profit on any finance facilities granted to customers.
Auto Finance offered by Ajman Bank applied for new cars or used cars.
You can apply for Ajman Bank Murabaha products through any of the Ajman Bank branches and Sales Channels.
No, you can apply for an Auto Finance even if you do not have an account with Ajman Bank.
No, you do not have to transfer your salary to Ajman Bank to get Auto Finance.
As a consequence of non-repayment, the actions taken may include the following:
(a) Negative rating in the Al Etihad Credit Bureau (AECB) or other Credit Information agency and the possible limitations on the ability to obtain financing in the future
(b) Legal Proceedings via Court
(c) Collection measures including presenting security cheques for clearing and claim on guarantees
In case additional securities in terms of pledge collaterals, guarantors, post-dated cheques etc. are obtained, these securities can be utilized or be enforced in case of
any default in payment or non-fulfillment of any terms and conditions of facility offer letter or any other signed contract.
Home/Land Finance facility extended to customers is based on the Islamic Finance Structure of “Ijarah Muntahia Bit Tamleek” Under the Ijarah transaction, the Bank (referred as ‘Mu’jir’) will purchase the property as requested by the Customer (referred as ‘Musta’jir’) and allow the Customer, the right to use it and benefit of the property for a predetermined period of time and in return the Customer will pay a pre-determined agreed rent (referred as ‘Ujrah’. At the end of the predetermined period, the Bank transfer the ownership to the customer.
For more information, about the structure and Shari’ah view point please follow the below link:
https://www.ajmanbank.ae/site/files/ISSC%20Fatwa%20-%20Ijara%20(Ready%20Asset).pdf
EIBOR refers to the Emirates Interbank Offered Rate which is set by the Central Bank of UAE and is the benchmark for your Home Finance profit rates.
You can buy or build your property through one of our products below:
- New Purchase Finance (Primary/Secondary Market)
- Financing of construction of the property
- Buyout (Customer buyout/seller buyout)
- Residential - Housing Program Finance
- New Purchase
- Customer Buyout
- Investment Real Estate Finance
- New Purchase Finance (Primary/Secondary Market)
- Buyout (Customer buyout/seller buyout)
Takaful is Islamic insurance, which works on the concept of donation. The policy owners mutually agree to help each other should anything untoward happen to any other policy owner.
Yes, it is compulsory. The insurance contributions calculated based on the cost of the property. The Takaful contribution amount will be debited every year from customer’s account & the policy shall be assigned to the bank.
Yes, Ajman Bank will help to arrange Life Takaful (insurance).
No, to safeguard your interest, the evaluation will be carried out by our independent agent.
No. Salary transfer and assignment are not mandatory. However, transferring your salary to Ajman Bank will provide you with more favorable financing terms.
As a consequence of non-repayment, the actions taken may include the following:
(a) Negative rating in the Al Etihad Credit Bureau (AECB) or other Credit Information agency and the possible limitations on the ability to obtain financing in the future
(b) Legal Proceedings via Court
(c) Collection measures including presenting security cheques for clearing and claim on guarantees
In case additional securities in terms of pledge collaterals, guarantors, post-dated cheques etc. are obtained, these securities can be utilized or be enforced in case of
any default in payment or non-fulfillment of any terms and conditions of facility offer letter or any other signed contract.
You can simply apply for Ajman Bank account through the digital Mobile app or by visiting the nearest Ajman Bank branch.
Yes, you can open a joint Ajman Bank account. Each of you will be able to operate the account independently or jointly. However, for some functions, you will have to give joint authorizations such as opening/closing of accounts. You cannot open a joint account with an individual who is less than 18 years of age.
Yes, an Ajman Bank account can be opened for a minor who is less than 18 years of age, without a Cheque Book facility.
Current account will be offered in all major currencies.
Not maintaining the required minimum balance could lead to fee being levied
The Bank may close the account;
- If account conduct is not as per bank’s policies or CBUAE regulations.
- If 4 or more cheques are returned due to insufficient funds.
- Not providing updated Legal IDs might result in the transactions being restricted, account being blocked, or account being closed.
- In the event of your failure to meet the product terms and conditions before and during your relationship with us.
Savings Account is an investment account based on a Shari’ah compliant underlying structure of Mudaraba that constitute on Profit and Loss Sharing (PLS) basis, it allows you to safely access your funds whenever you need along with investing the available balances for the possibility of generating profit that is distributed as per the Profit Distribution Policy and deposited, if any, into the account
Profits in Savings Accounts are determined based on the bank´s earnings from Shari’ah-compliant investments. Typically, these profits are shared between the bank and account holders according to an agreed-upon profit-sharing ratio. The exact methodology can vary between Islamic banks.
While Savings Accounts in Islamic Banking aim to avoid interest and adhere to Islamic principles, they are not entirely risk-free. The profitability of your account depends on the success of the bank´s investments. If the investments generate profits, you receive a share.
However, this investment account is based on the Islamic principle of Mudaraba where you share profits and bear losses as stipulated in the Banking Service Agreement.
Not maintaining the required minimum balance could lead to fee being levied
The Bank may close the account;
- If account conduct is not as per bank’s policies or CBUAE regulations.
- Not providing updated Legal IDs might result in the transactions being restricted, account being blocked, or account being closed.
- In the event of your failure to meet the product terms and conditions before and during your relationship with us.
Wakala Deposits are a type of investment account in Islamic Banking that follows the Master Wakala (agency) contract. Depositors authorize the bank to invest their funds in Shari’ah-compliant activities on their behalf. The bank acts as an agent (Wakil), charges a fee as well as incentive, subject to achieving the expected profit rates.
KEY FACTS STATEMENT (KFS) – WAKALA & UPFRONT PROFIT WAKALA TERM DEPOSIT ACCOUNT
Unlike conventional fixed deposits, Wakala Deposits in Islamic Banking do not guarantee a fixed interest rate. Instead, it involve with an agency agreement in Shari’ah-compliant investment portfolios (diversified) in which the Wakil (Agent) anticipates to generate the expected profit rates. Therefore, the Profits can vary, making Wakala Deposits a more dynamic investment option.
However, In the Wakala Deposit the Bank will not guarantee any profits, or repayment of any part or entire portion in respect of Wakala Deposit, also these Deposits are exposed to potential losses subject to the economic condition of the landscape in which the investment has been made which may even affect the principle amount of the funds deposited.
KEY FACTS STATEMENT (KFS) – WAKALA & UPFRONT PROFIT WAKALA TERM DEPOSIT ACCOUNT
In Wakala Deposits, the bank charges a fee for its services as an investment manager. This fee is typically deducted from the profits earned or the principle amount. The rembalance is returned to the the depositor. In some cases the Investment Manager (Wakil) may waive the Wakala Fee, but shares the pre-agreed incentive, has the Wakil achieved the anticipated profit.
KEY FACTS STATEMENT (KFS) – WAKALA & UPFRONT PROFIT WAKALA TERM DEPOSIT ACCOUNT
Customer shall bear all the risks associated with:
- The Investment (which shall include, for the avoidance of doubt, the risk of the partial or total loss of the Investment Amount)
- All acts of the Bank as agent for the Customer except those risks resulting from the Bank’s willful misconduct or gross negligence or breach of its obligations under the Wakala Agreement. The Bank shall not be liable or responsible to the Customer for any risks or actual losses in relation to the Investment (including its performance) except those risks and actual losses (not to include any opportunity costs or funding costs) resulting from the Bank’s willful misconduct or gross negligence or breach of its obligation under the Wakala Agreement.
KEY FACTS STATEMENT (KFS) – WAKALA & UPFRONT PROFIT WAKALA TERM DEPOSIT ACCOUNT
structured according to the Islamic principles of Murabaha and Wakala. Murabaha involves a commercial transaction consisting of the purchase and sale of Shari’ah compliant commodities, in which the Cost and Profit both are know the parties. Post Commodity Murabaha transaction, the limit is awarded to the credit card holder for his personal use to meet day-to-day expenses.
It differs from conventional credit cards primarily in its approach to profit generation and strict adherence to Islamic finance principles, notably the avoidance of interest-based transactions (Riba).
KFS - ENAR ULTRACASH Card (ULTRA C) R3.pdf (ajmanbank.ae)
Charging profit on accrued profit (compounding profit) is generally not permitted in Islamic finance, as it may be viewed as similar to charging interest (Riba), which is strictly prohibited. Islamic banks typically avoid such practices to ensure compliance with Shari’ah principles. To confirm the specific terms and conditions of your Islamic covered credit card, review the cardholder agreement provided by the bank.
Islamic credit cards do not charge profit on cash advances, aligning with Islamic finance principles. However, there is a fee associated with cash withdrawal services. To understand these fees and other terms and conditions related to your Islamic covered credit card, review the cardholder agreement provided by the bank and also refer to the bank’s Tariff of Charges.
Islamic credit cards may have a late payment fee that customer undertakes to pay on demand to the bank with delegation to donate into the charity under the supervision of Shari’ah Committee. For avoidance of doubt, such fee never become a part of the Bank’s income. To understand these fees and other terms and conditions related to your Islamic covered credit card, review the cardholder agreement provided by the bank.
The Annual Percentage Rate (APR), structured in compliance with Shari’ah principles of Murabaha, is essentially the profit rate. It is used to calculate the profit you owe on your balance. You can find this listed as "MURABAHA FINANCE PAYMENT DUE (profit)" on your billing statement when charged profit. It´s important to note that APR is not applied if you make a full payment of your previous bill before the due date.
The Credit-Free Period, also known as the Purchase Grace Period, offered by credit cards allows you to make purchases without incurring any Murabaha profit from the date of purchase until the due date. To benefit from this period, it´s essential to pay the entire outstanding balance in full every month.
KFS - ENAR ULTRACASH Card (ULTRA C) R3.pdf (ajmanbank.ae)
In the event of a Customer’s failure to meet the Bank’s terms and conditions before and during the Consumer’s relationships with the Bank, the bank may initiate appropriate action as deemed necessary as a consequence of non-repayment or non-fulfillment of terms and conditions.
The actions taken may include the following:
- Negative rating in the AECB bureau or other Credit Information agency and the possible limitations on the ability to borrow/obtain financing in the future
- Legal Proceedings via Court
- Collection measures including presenting security cheques for clearing and claim on guarantees in case if additional securities in terms of pledge collaterals, post-dated cheques etc. are obtained, these securities can be utilized or be enforced in case of any default in payment or non-fulfillment of any terms and conditions or any other signed contract.
