Structure for tawarruq-based deposits/placements
| Step | Details |
|---|---|
| 1 | The customer places money with the bank |
| 2 | The bank as agent for the customer purchases a commodity from commodity trader 1 at a cost price that equates to the placement amount |
| 3 | Upon purchase of commodity by the bank, the customer (as the owner of the commodity) then sells that commodity to the bank at a selling price comprising cost-plus-profit to be paid by the bank at a later date, which is at the end of the agreed tenure |
| 4 | The bank (as the owner of the commodity) will then sell the commodity to commodity trader 2 at a price that equates to the amount placed by the customer for the bank to use during the placement period |
| Step | Details |
|---|---|
| 1 | The customer places money with the bank |
| 2 | The bank as agent for the customer purchases a commodity from commodity trader 1 at a cost price that equates to the placement amount |
| 3 | Upon purchase of commodity by the bank, the customer (as the owner of the commodity) then sells that commodity to the bank at a selling price comprising cost-plus-profit to be paid by the bank at a later date, which is at the end of the agreed tenure |
| 4 | The bank (as the owner of the commodity) will then sell the commodity to commodity trader 2 at a price that equates to the amount placed by the customer for the bank to use during the placement period |