Filter by Categories
Accounting
Banking

Islamic Finance




Commitment Cash Margin


It stands for the Arabic term arbun/arboon/urboun (عربون). It is the amount of money which is paid by a potential buyer to the seller, particularly in murabaha contracts (murabaha to the purchase orderer), against the purchase of a specific asset. If the buyer proceeds with the sale and collects the asset, then this money will be considered part of the price. The buyer will be required to pay only the remaining amount in order to take that asset into his possession and ownership. However, if the buyer chooses not to conclude the sale, the urboun will belong to the seller.

The commitment cash margin is also known as earnest money or down payment.



ABC
The last three decades have witnessed the modern rebirth of Islamic finance both in terms of literature and practice. Islamic banks and ...
Watch on Youtube
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments


    Leave Your Comment

    Your email address will not be published.*