Muamalat (Financial Transactions)

Muamalat refers to the principles governing Islamic financial transactions, emphasizing fairness, transparency, and ethical conduct. Unlike conventional banking that often involves interest (riba), Muamalat transactions are based on real assets and risk-sharing. Common processes include profit-and-loss sharing (mudharabah, musharakah), leasing (ijarah), and sales (bay’). These principles ensure that financial dealings are aligned with Islamic values, promoting social justice and mutual benefit. Essentially, Muamalat provides a framework for conducting financial activities in a manner that is ethically responsible and compliant with Islamic law.