| ʿIwaḍ | This is the concept of fair counter-value which pervades Islamic exchange dealings of economic agents including financiers and recipient of financings | An asset sold is exchanged for the price paid. An asset’s usufruct is granted temporarily for rental payments paid |
| Risk | It refers mainly to the risk of an uncertain outcome related to asset ownership or the buying and selling of assets in the market. It concerns ownership, market and capital loss risk. Risk varies: some forms may be mitigated, other forms may not; yet others are unavoidable and may only be managed | Ownership risk occurs when possessing inventory that cannot be sold or is sold at a loss or which may be subject to loss including damage or destruction. IBs subject themselves to ownership risk in selling assets such as property and vehicles and – theoretically – in financing venture enterprises which impact on their returns |
| Ḍamān | The liability of bearing the aforementioned risks rests upon the transacting agents equitably according to the contractual forms undertaken | The asset vendor in an MPO/AITAB financing will bear the liability of destruction of the asset as it is the actual owner. In MMP financing, the bank and customer as partners will equitably bear the loss of contributed assets/capital in the case of destruction of the asset being financed |
| Value-adding | Effort leads to adding value and is indicative of real economy contact and inherently entails the bearing of risks (ownership, market and capital loss) | In a ribā-based loan, no value is added as a loan is made, pursuant to which the principal and an increment are returned with no risk to the lender. In a valid (permissible) sale, the asset is sold at a mark-up price facilitating a trade transaction between producers and consumers; the vendor would bear the risk. A partnership-based financing mode also adds value through the facilitation of trade or business. Risk is evident in either form of financing |
| Māl | Māl, as a factor of production, is subject to risk as other assets are. Māl is used to finance assets, projects and ventures which represent activities that bear capital loss risks to the owners of capital (partners/muḍārib) | In an MMP, the IB uses its funds to purchase an asset, which is then contributed to the mushārakah, with the customer contributing a percentage of his/her own monetary capital. Both are forms of capital that are staked in a mushārakah |