Bai’ul Inah – Is it really Permissible? Part I
Nowadays, we are bombarded by advertisements/flyers/pamphlets from banks, financial institutions even Ahlong (loan shark) about their Islamic Financing or Products especially BAI’UL INAH.
First of all, we need to understand what is Bai’ul Inah and why it is favorable by the banks and even ALONG(loan shark). Bai’ul Inah is a selling and buying contract that practices by the banks/financial institutions/Ahlong to BYPASS the prohibition of riba’/interest/usury/faedah (malay) by Islamic Laws or Syari’ah Laws. The selling and buying transaction are only an excuse to give out and receive loan in cash.
The four Schools of Fiqh (Maliki, Hanbali, Hanafi and Shafie) prohibit this practice of Bai’ul Inah since the initial intention of the contract is to give out and receive loan, not selling and buying. However, there is a certain Ulama’ from Shafie School is allowing this practice but under a strict conditions. Currently, Malaysia is the ONLY Muslim country that is allowing the concept of Bai’ul Inah.
Comments/Suggestions/Corrections are welcome.
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