Alhdua CIBE - Bai ( buying & selling ) by Zubair Mughal

2. Bai ( Buying & Selling)
Presented by :
Zubair Mughal
CEO – AlHuda: Centre of Islamic Banking & Economics

3. Basic Rules of Bai
 Existence of Product/Commodity
 Ownership of Product/Commodity
 Possession of Product/Commodity

4. Basic Rules of Bai
 Unconditional basis
 Product have value/Price.
 Bai on Such product which is
permissible in Islam.

5. Basic Rules of Bai
 Product Must be Identify, clear with all
demanding Qualities.
 Not based on any incident, struggle etc
 Price must be clearly identified.

6. Bai (Buying & Selling)
Basic Kinds of Bai

7. Kinds of Bai
 Bai Musawamah
 Bai Murabaha
 Bai Surf
 Bai Salam
 Bai Istisna’
 Bai Urboon

8. Basic Kinds of Bai
 Bai Eenna
 Bai Touliya
 Bai Wadhia

9. Bai
There are three basic type of Bai’s which
are using in Islamic Banking as the
mode of financing in Pakistan
 Murabahah
 Salam
 Istisna’

10. Murabahah
 Basically, it’s not a mode of financing
but a source to avoid interest Dealing
 It’s not a type of loan, but a deal (Bai)
 Murabahah can be used as source of
financing when client needs funds to
purchase any product/Machinery etc.

11. Murabahah
 Sharing of Risk of loss differentiate
Murabahah from the interest category
 Product Must be bought from third party
for avoid buy back transaction
 Roll over is not Valid in Murabahah
 If actual cost can not be identified then
Murabahah deal not possible.

12. Bai
Important Note
Following 3 Basic Rules of Bai are
exceptional for Salam & Istisna’
 Existence of Product/Commodity
 Ownership of Product/Commodity
 Possession of Product/Commodity

13. Salam
 Pay 100% amount in Advance.
 Product must be quantified, identified
and Measured with quality.
 Date of delivery, Time, Place must be
mentioned clearly in advance.
 Salam is not valid for a specific
farm/land/garden.

14. Istisna’
 Not necessary to pay the 100% amount
in advance Like Bai salam.
 Price must be decided on beginning of
the contract.
 Qualities, features of that product must
be clearly identified.

15. Bai
Differences Between
Istisna and Salam

16. Differences Between Istisna
and Salam
 Istisna deal with manufacturing items,
but Salam could or could not be
manufacutred, but salam ideal of
agriculture sector.
 In salam advance payment is
necessary, but in Istisna’ its not.

17. Differences Between Istisna
and Salam
 Date, time of delivery the necessary
part of Bai Salam, But in Istisna, it is not
the part of the deal.
 In Bai salam, it can be cancelled one
sided, but in Istisna, it could be
cancelled, if production is not started
yet.

18. Type of Bai according to Quality
 Bai Salah
 Bai Fasid
 Bai Batil
 Bai Maqoof

19. Type of Bai according to Quality
 Bai Majool
 Bai Muqayaddah
 Bai Mu’ajal

20. Thank you