| Word | Meanings |
|---|
| Maal | (1) Wealth, money, property; any valuable thing which can be possessed. |
| | (2) Anything that can be possessed; includes money such as gold, silver and monetary units, commodities such as clothes and foodstuffs and immovable properties such as houses and factories. |
| Maal e Mutaqawam | Things the use of which is lawful under the Shar¯ı´ah, or wealth that has a commercial value. Legal tenders of the modern age that carry monetary value are included in M¯al-e-Mutaqawam. It is possible that certain wealth has no commercial value for Muslims (non-Mutaqawam) but is valuable for non-Muslims. Examples are wine and pork. |
| Mabi | Subject of sale – the commodity that is being traded in a transaction. |
| Madhab | (1) School of religious and moral interpretation. |
| | (2) A Fiqh school or orientation characterised by differences in the methods or approaches by which certain sources and texts are understood and therefore differences in the Shari'ah rulings which are deduced from them. There are four well known schools of Islamic jurisprudence of religious law in Sunni Islam associated with the classical jurists who founded them (Hanabali, Hanafi,Maliki and Shafi'i). |
| Madinah | The second holiest city in Islam located in the Kingdom of Saudi Arabia. |
| Mafhm an Nass | The clear implication of the text |
| Maisir | (1) Gambling |
| | (2) A game of chance condemned by the Koran. |
| | (3) Gambling, from a pre-Islamic game of hazard. |
| | (4) Stakes of slaughtered and quartered camels. It refers to all types of hazard and gambling – acquisition of wealth by chance/easily (without paying an equivalent compensation (‘Iwad) for it or without working for it, or without undertaking any liability against it). |
| | (5) Games of chance or gambling, trying to earn easy money without having to provide equivalent consideration. A prohibited activity, as it is a zero-sum game just transferring the wealth not creating new wealth. One of three fundamental prohibitions in Islamic finance, the other two being riba and gharar . The prohibition on Maysir is often used as the grounds for criticism of conventional financial practices such as speculation, conventional insurance and derivatives. |
| Makkah | The first holiest city in Islam located in the Kingdom of Saudi Arabia and the birth place of Prophet sahammad (pbuh). |
| Makruh | (1) Discouraged act |
| | (2) Reprehensible, discouraged. Technical term used by the jurists to classify actions with regard to their desirability. Makruh is said to be an action which is not clearly prohibited and not punished for committing. |
| Maliki | "One of the four well-known schools of thought in Islamic Jurisprudence or religious law engaged in the interpretation of theQur’an and Sunnah. Founded by one of the classical jurists, Imam Malik Ibn Anas (d. 795 AD), followers are known as Malikis. Others are Hanbalis, Hanafis and Shafis. Zahiri is another known school developed by Daud ibn Khalaf (d. 883 AD). The Jafri Shia branch of Islam school in Islamic jurisprudence was developed by Imam Ja'far al-Sadiq (d. 765) at about the same time its legal fiqh counterparts of Sunni branch of Islam were being codified. It was distinguished from Sunni law on matters regarding inheritance, religious taxes, commerce, and personal status." |
| Malum | Known – in the knowledge of the parties. |
| Mandub | Commendable act |
| Manfaah | Lit. benefit or utility. The yield which a property produces. The term is often used by jurists to describe the usufruct (usage or services) associated with a given property, especially in leasing transactions. |
| Maqasa | Clearance of mutual debts. |
| Maqsad | The purpose or ultimate wisdom behind a law or legal ruling. The general objectivs of Islamic law, Shari'ah. |
| Market Rate | The rate of interest a company must pay to borrow funds currently. Program-related investments generally are offered at below market rates or at no interest rate. |
| Masalih Mursalah | Public interest as determind in the light of the rules of Shari'ah. As a juristic termMaslaha Mursalah refers to accepting public interest in the absence of ruling regarding an issue from the Qur’an or Sunnah. Also known as Maslaha Al Mursalah. |
| Maslaha | (1) The general interest. |
| | (2) In the public interest |
| | (3) The beliefs of Muslims |
| | (4) "Interest" as in interest of the state. |
| | (5) Public interest, social welfare – a condition of society that Shari’a is committed to protect and maintain. |
| | (6) It refers to unrestricted public interest (welfare).invoked to prohibit or permit something on the basis of whether or not it serves the public's benefit or welfare. (Plural of Masalih). Literally, it means benefit. Technically, It refer to any action taken to protect any one of the five basic objectives of the Shari'ah, i.e protection of faith, life, progeny, property and reason. |
| Maslaha e Mursalah | The aspect of general welfare/benefit of mankind/society that is kept in mind by the scholars competent to undertake Ijtihad while resolving issues confronted from time to time Catering to the well-being of people in the worldly life and also in the Hereafter or relieving them of hardships is the basic objective of the Sharıah. |
| Mauqoof | Suspended, Stopped for a while. |
| Mawalat | A contract in ancient Arabia in which one party agreed to bequeath his property to the other on the understanding that the benefactor would pay any blood money that may eventually be due by the former. |
| Mawquf | (1) Valid but suspended contract |
| | (2) A contract, the effectiveness of which is suspended until any happening. |
| Mecca | The first holiest city in Islam located in the Kingdom of Saudi Arabia and the birth place of Prophet Muhammad (pbuh) |
| Medina | The second holiest city in Islam located in Kingdom of Saudi Arabia |
| Mezzanine | Debt; A hybrid of debt and equity financing that is is typically used to finance the expansion of existing companies. |
| Milkiyyah | Ownership. |
| Mirath | Inheritance. |
| Mithaq | A covenant; refers to an earnest and firm determination on the part of the concerned parties to fulfil the contractual obligations; has more sanctity than the ordinary contracts. |
| Mithlam bi Mithlin | Like for like (in exchange transactions). |
| Mithli | (1) Fungible: perishable good. |
| | (2) Fungible goods; goods all units of which are the same and that can be returned in kind, i.e. gold, silver, wheat, all currencies, etc. |
| Muaawamah | Sale for years – e.g. fruit of a tree or an orchard sold for more than one year to come without stipulating the amount, price or time of delivery – prohibited. |
| Muamalat | (1) Economic transaction(s). |
| | (2) Human-to-human relationships |
| | (3) All kinds of economic activities related to exchange of goods and services. |
| | (4) Dealing between the humans. Lit: economic transaction related to exchange of goods and services. Includes financial transaction. Technically, lease of land or of fruit trees for money, or for a share of the crop. (See: Mu'amalah and Fiqh al mu'amalat.) |
| Mubah | (1) Permissible act |
| | (2) Things or acts permissible by the Shari’ah.Also see |
| | (3) Object that is lawful (i.e. something which is permissible to use or trade in). |
| Mudaraba | (1) Profit sharing or trust financing |
| | (2) trustee finance, or commenda partnership. |
| | (3) A form of partnership where one party provides the funds while the other provides expertise and management. The latter is referred to as the Mudarib. Any profits accrued are shared between the two parties on a pre-agreed basis, while any loss is borne by the provider of the capital. |
| | (4) Trust financing, a business contract in which one party brings capital and the other effort. The proportionate share in profit is determined by mutual agreement. But the loss, if any, is borne only by the owner of the capital, in which case the entrepreneur gets nothing for his labour (see: rabb almaal). |
| | (5) An investment partnership with profit-loss-sharing implications. One or more partners as investors (Rab al Mal) provide 100% the capital to an entrepreneur (the partner who provides entrepreneurship and management known as Mudarib) to undertake a business activity. Profit is shared between the partners on a pre-agreed ratio, any loss is borne only by the investing partner(s) alone. For the Mudarib the loss is the share of the expected income for the efforts put into the business activity. The investors have no right to interfere in the management of the business but can specify conditions that would ensure better management of the capital money. In this way Mudarabah is sometimes referred to as a sleeping partnership. As a financing mode, an Islamic bank can provide capital to a customer for a business activity. The customer provides the expertise, labor and management; profits are shared between the bank and the customer according to predetermined ratio while financial losses are borne by the bank and the bank risks losing the capital invested with the customer which justifies the bank's claim to a share of the business profit. Islamic banks also apply the concept of Mudarabah to pay a return on customer deposits held in investment account. The Bank becomes wholly responsible and liable in the management and investment the customer deposits and utilises the funds as business capital by the bank, the bank will have the right to manage the funds as it thinks fit in permissible activities that it considers are profitable and share the profit on the basis of the agreement made between the bank and the customer. |
| | (6) A form of business partnership contract in which one party brings capital and the other personal effort to undertake a business enterprise, as manager or entrepreneur.Mudarabah is mostly translated in English as profit and loss sharing. There is no loss sharing in a Mudarabah contract. Profit and loss sharing a is more accurate description of the Musharakah contract. The Mudarabahcontract may better be represented by the expression profit sharing. The proportionate sharing in the profit is determined by mutual agreement; the loss, if any, is borne only by the owner of the capital, in which case the entrepreneur gets nothing for the labour put in. The capital provider or financier is known as ‘ rabal-maal’ and the entrepreneur as ‘mudarib’. In the Islamic Jurisprudence, different duties and responsibilities have been assigned to each of these two. As a matter of principle the owner of the capital does not have a right to interfere in to the management of the business enterprise which is the sole responsibility of the manager/entrepreneur. However, the capital owner has every right to specify such conditions that would ensure better management of the capital invested. That is why sometime Mudarabah is also referred as sleeping partnership. |
| Mudaraba Contract | Trustee financing contract, where one party, the financier, entrusts funds to the other party, the entrepreneur, for undertaking an activity. |
| Mudaraba Muqayyadah | Special investment account |
| Mudaraba Mutlaqah | General investment account |
| Mudaraba Sukuk | As a financing technique adopted by Islamic banks, it is a contract in which all the capital is provided by the Islamic bank while the business is managed by the other party. The profit is shared in pre-agreed ratios, and loss, if any, unless caused by negligence or violation of terms of the contract by the ‘mudarib’ is borne by the Islamic bank. The bank passes on this loss to the depositors. |
| Mudarib | (1) Managing trustee. |
| | (2) Agent (usually, bank) for the investor |
| | (3) An entrepreneur or a manager of a mudaraba project. |
| | (4) In a Mudarabah contract, the person or party who acts as entrepreneur. |
| | (5) The manager of the investment in a mudaraba contract – the entrepreneur rather than the investor. |
| | (6) The partner in Mudarabah providing entrepreneurship and management to a partner providing the capital. Profit is shared between the partners on a pre-agreed ratio, any loss is borne only by the investing partner alone. For the Mudarib the loss is the share of the expected income for the efforts put into the business activity. The investors have no right to interfere in the management of the business but can specify conditions that would ensure better management of the capital money. |
| Mudeer al Takaful | Takaful Operator. |
| Muflis | Destitute; insolvent/bankrupt debtors. |
| Mufti | (1) Chief religious cleric, usually government-appointed. |
| | (2) Islamic banks practice Mudarabah in its both forms. In case of individual Mudarabah an Islamic bank provides finance to a commercial venture run by a person or a company on the basis of profit sharing. The joint Mudarabah may be between the investors and the bank on a continuing basis. The investors keep their funds in a special fund and share the profits without even the liquidation of those financing operations that have not reached the stage of final settlement. Many Islamic Investment Funds operate on the basis of jointMudarabah. |
| Mugharasah | Joint venture projects involving plantation of gardens and sharing the produce. |
| Muhtasib | Ombuds person. |
| Mujtahid | Legal expert, or a jurist who expends great effort in deriving a legal opinion or interpreting sources of the law. |
| Mulamasah | Sale by touching the subject matter or its carton without knowing its detail. |
| Munabadhah | If a man throws to another a garment in exchange for a garment that the other throws to him without both of them examining them. |
| Muqarada | Loan participation. |
| Muqasah | Set-offs |
| Muqawala | A contract whereby one of the parties thereto undertakes to make a thing or to perform work with a consideration which the other party undertakes to provide. |
| Murabaha | (1) Trading |
| | (2) Contract whereby a financial institution buys goods or commodities on behalf of a borrower and then sells it on a deferred basis at a mark-up. |
| | (3) Resale with a stated profit; for example the bank purchases a certain asset and sells it to the client on the basis of a cost plus mark-up profit principle. |
| | (4) Cost-plus financing − technically a contract of sale in which the seller declares his cost and profit, and the client asks the lender to purchase a specific asset for them. The lender does this for a defined amount over the cost of the asset, which is agreed in advance. |
| | (5) Lit. it means a sale on mutually agreed profit. Technically, it is a contract of sale in which the seller declares his cost and the profit. This has been adopted by Islamic banks as a mode of financing. As a financing technique, it can involve a request by the client to the bank to purchase a certain item for him. The bank does that for a definite profit over the cost. |
| | (6) Cost-plus financing - a contract sale between the financier or bank and its client for the sale of goods at a price which includes a profit margin agreed by both parties. As a financing technique, it involves the financier or bank purchasing goods required by the client. The goods are then sold to the client with a mark-up. Repayment, usually in instalments is specified in the contract. Some have questioned the legality of this financing technique with mark-up on cost because of its similarity to riba or interest. |
| | (7) Lit. sale on mutually agreed profit. Technically a contract of sale in which the seller declares the purcahse cost and profit.A contract of sale between a seller and a buyer; the seller sells certain specific goods to the buyer at a cost plus an agreed profit mark-up for the seller. The seller must disclose the cost of goods and the profit mark-up. The financing mode adopted by Islamic banks takes the form of Murabaha Muajjal which literally means a credit sale; it is a contract in which the bank purchases goods required by a customer and after taking delivery then resells the goods to the customer with an agreed profit mark-up on the disclosed purchase price; it allows the customer, as buyer, to pay the higher price of the goods at a future date in a lump sum or in installments. The concept which is commonly referred to as simply Murabaha is widely adopted as a mode of financing by Islamic banks instead of lending money to business customers on interest. By paying the higher price to the bank, the customer has effectively obtained goods on credit from the bank without taking out a loan on interest to purchase the goods direct from the supplier. Some have questioned the legality of this financing technique because of the similarity of the profit mark-up to interest on a conventional loan. However, the difference is that an Islamic bank must purchase the goods in its name first and bear the risk for the goods before the goods are sold by the bank and delivered to the customer. (See Murabaha Mu'ajjal. ) |
| | (8) Mark up or Cost plus financing. The wordMurabaha is derived from the Arabic wordRibh that means profit. Originally, Murabahawas a contract of sale in which a commodity is sold onward at profit. The seller is obliged to tell the buyer the original cost price and the profit mark-up. This contract has been modified a little for application in the financial sector. In its modern form Murabaha has become the single most popular technique of financing amongst the Islamic banks all over the world. The Murabaha mode of finance operates in the following way: The client approaches an Islamic bank to get finance in order to purchase a specific commodity. An interest-based bank would lend the money on interest to this client. The client would go and buy the required commodity from the market. This option is not available to the Islamic bank, as it does not operate on the basis of interest. It cannot lend the money on interest. It cannot lend money with zero interest rate, as it has to make some profit to be in the business. The bank purchases the commodity on cash and sells it to the client on an agreed profit mark-up. The client buy the commodity from the bank on deferred payment basis. Thus, the client gets the commodity on credit for which financing would have been required and the Islamic bank makes some profit on the amount it has spent in acquiring the commodity and selling it on to the client. |
| Murabaha Contract | Cost-plus-profit or cost-plus-markup contract |
| Murabaha lil ’amri bil Shira | Murabaha to Purchase Orderer. (also, Murabaha li Wa´da bi Shira) |
| Murabaha Mu’ajjal | Lit. it means a credit sale. Technically, it is a financing technique adopted by Islamic banks that takes the form ofMurabaha Muajjal. It is a contract in which the bank earns a profit margin on its purchase price and allows the customer as buyer to pay the price later. i.e. sale with deferred payment. Murabaha is commonly understood as deferred payment sale. Also known as Bai Mu'ajjal. |
| Murabaha, Commodity | A murabaha contract using certain specified commodities, through a metal exchange. |
| Musaqah | (1) Arrangement between, for example, a farmer and a worker who agrees to water the garden or both share in the harvest |
| | (2) A contract in which the owner of a garden shares its produce with another person in return for his services in irrigating the garden. |
| | (3) A contract in which the owner of the garden/orchard shares the produce with another person (a worker) in return for services in irrigating the garden/orchard. |
| Musawamah | (1) A general kind of sale in which the price of the commodity to be traded is bargained between the seller and the purchaser without any reference to the price paid or cost incurred by the former. |
| | (2) Bargain on price, where the seller does not disclose the original cost of the goods. Musawamah is a form of Murabaha, the difference being that the seller and the buyer bargain on price without reference to the actual price paid by the seller; the seller may not wish disclose the original price of the goods, or have full knowledge of the cost of the goods that may have been purchased in a lot with other goods. Musawamah was a common form of negotiation used in trading business in commerce in the early days of Islam and is not widely adopted by Islamic banks. |
| Musharaka | (1) A type of profit sharing |
| | (2) Joint venture between a financier and an entrepreneur. |
| | (3) Joint venture or partnership financing or equity participation |
| | (4) Partnership between two parties, who both provide capital towards the financing of a project. Both parties share profits on a pre-agreed ratio, but losses are shared on the basis of equity participation. Management of the project is carried out by both parties. However, the partners also have a right to forego the right of management/work in favour of any specific partner or person. There are two main forms of Musharakah: Permanent Musharakah and Diminishing Musharakah. |
| | (5) A contract of partnership in which two or more partners provide capital and share profits or losses as the case may be. An investment partnership with profit-and-loss sharing. A musharakah contract is similar to a mudarabah contract, the difference being that in a musharakah all the partners contribute to the capital and share in both the profit and the loss. They also have the right, but not the obligation to participate in the management. All partners have a right to participate in the management of the project. However, the partners also have a rig ht to waive the right of participation in favour of any specific partner or person. Profit is shared as per-agreed ratio while the loss is shared in proportion to the capital contributed (money invested by each partner. |
| | (6) Lit. sharing; an investment partnership with profit-loss-sharing implications. All the partners contribute capital towards the financing to undertake a business activity. The partners share profits on a pre-agreed ratio while losses are shared according to each partner’s capital contribution. The business activity may be managed by all, some, or just one of the partners. Musharakah allows Islamic banks to provide financing for purchase of an asset required by a customer; the bank invests capital in the co-ownership in the asset with the customer, instead of providing interest-bearing loans. The bank will achieve a return on its capital contribution in the form of a share of the actual profits earned, according to a ratio agreed in advance. However, unlike a traditional creditor, the bank will also share in any losses.Musharakah is often used by Islamic banks for financing large projects. The concept is distinct from fixed-income investing. |
| Musharaka Contract | Musharaka contract is an equity participation contract, whereby two or more partners contribute with funds to carry out an investment. |
| Musharaka Mutanaqisah | Diminishing partnership |
| Musharaka, Diminishing | Another form of Musharakah allowed as a financing mode by Shari’ah scholars in recent years. An agreement that combines the concept of partnership as in Musharakahto invest in a joint asset and leasing. It allows equity participation by a bank and a customer in an asset and provides a method through which the bank keeps on reducing its equity in the project and ultimately transfers the ownership of the asset to the customer. This involves the customer simultaneously purchasing the bank's equity in the form of unit shares, progressively reducing it until the bank is left with no equity left and thus ceases to be a partner. Until such time, the bank leases its share to the customer who pays a rental to the bank for the use and enjoyment of the bank’s equity share. Islamic banks use this mode widely for financing home purchases, commonly known as Islamic mortgages. |
| Musharaka, Permanent | An agreement which allows equity participation and sharing of profit on a pro rata basis. The duration of the contract is unspecified making it suitable for Islamic banks to finance projects where funds have to be committed over a long period. In this form of Musharakah an Islamic bank participates in the equity of a project and receives a share of profit on a pro rata basis. The period of contract is not specified, so it can continue so long as the parties concerned wish it to continue. This technique is suitable for financing projects of a longer life where funds are committed over a long period and gestation period of the project may also be long. |
| Mushtarik | Participant in Takaful. |
| Muslim | One who professes the faith of Islam or is born to a Muslim family. |
| Mustahab | Meritorious. |
| Mustarsal | An unknowing entrant into the market – not aware of the market. |
| Muthman | Subject of a sale. |
| Muzaraa | Share cropping; a contract in which one person agrees to till the land of another person in return for a part of the produce of the land. |
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