An Islamic bank or financial institution entering into a murabaha transaction as a financier (actually both as a seller and provider of funds) may incur expenses associated with preparing and processing of contract-related documents. Such expenses should be shouldered by both parties (the bank and its customer), provided that they are fair and reasonable, i.e., they reflect actual figures in terms of work done and resources used up.

More specifically, Islamic banks should be watchful as to not inflate these figures by adding commitment fees or credit facility fees thereto. In essence, it is impermissible to receive such fees from murabaha customers. The first type (commitment fees) is not allowable in the sense that it is based on an abstract intention to transact, which, per se, cannot be a subject of exchange. Similarly, the second type (facility fees) is impermissible on the ground that shari’a prohibits charging fees on a mere readiness to provide finance on a deferred payment basis.

Expenses incurred on carrying out a feasibility study by the bank with respect to the underlying commodity of murabaha can be moved on to the customer provided that this study was requested by the customer and has been done on his behalf and to his own benefit.