What is Murabaha?

In a financing illustration, a provider purchases an asset and resells it to the customer at an agreed higher price, with payment deferred or made in instalments. This differs conceptually from paying rent to use an asset.

Knowing the name does not establish which asset is involved, who takes ownership at each stage or which separate promises and security documents form part of the transaction. Ask for a complete transaction diagram and the full agreement.

This is terminology education. We have not established that a particular provider in Mizan’s directory currently offers Murabaha for your purpose. The UK source explains contract types; its tax and legal treatment should not be applied to Australia.

Questions to consider

• What is the original purchase price and the final sale price?
• When does ownership transfer, and what happens if the initial purchase cannot proceed?
• How are late payment, cancellation and early settlement treated?

What this does not establish

No Australian provider availability, personal eligibility or tax treatment is inferred from this definition.

Sources and scope

• HMRC: Islamic contract types — terminology only, not Australian law · checked 2026-10-01

Last checked 2026-10-01. Review due 2026-10-08. Provider-specific examples are not industry standards.