A shari’a-compliant adaptation of the conventional cross-currency swap. This structure applies the mode of tawarruq (Islamic monetization or tripartite resale). It takes into consideration the principal amount at the beginning and end of the swap term, in addition to the stream of cashflow during that term. Therefore, it constitutes a series of commodity murabaha transactions based on a tawarruq contract. For example, a company is contemplating an investment of USD 50 million in Spain, and is concerned about the possible fluctuations of the exchange rate (USD/EUR). Suppose this company wants to buy recently issued sukuk denominated in Euro, for an amount of USD 50 million. The sukuk will generate a quarterly return over each year up to maturity date (which is, say, 2 years from now). The company can invest in the sukuk issue without being exposed to the currency risk, by entering with a bank into a cross-currency swap.

Pricing a cross-currency swap depends on the expected rate of profit agreed upon by the bank and its institutional client.

Islamic cross-currency swaps are known for short as ICCSs.