Ijara: leasing with the right to purchase within Islamic financing

Ijara is a form of Islamic financing based on the leasing of property with the possibility of subsequent purchase. This instrument is often compared to leasing, but it has clear features that distinguish it from traditional financial schemes.

Ijara is a form of Islamic financing based on the leasing of property with the option of subsequent purchase. This instrument is often compared to conventional leasing, but it has clear features that distinguish it from traditional financial schemes.

In Ijara, a financial institution acquires the required property — for example, a car, equipment, or real estate — and leases it to the client for a specified period. The client makes regular rental payments for the use of the property, and at the end of the lease term, they can fully purchase it, usually at a symbolic price.

During the term of the contract, ownership of the property remains with the lessor.

Advantages of Ijara:

- The ability to use the property without the need to purchase it immediately;

- Clear and transparent rental terms;

- No interest;

- Compliance with Islamic ethical principles.

Ijara is particularly in demand when a client needs property for business, work, or personal use but does not have the means or desire to purchase it immediately. It is a convenient and fair alternative to commercial leasing, offering flexible and ethical terms.

Moreover, Ijara contributes to the development of the real economy: the property acquired under such transactions is used for its intended purpose, generates benefits, creates jobs, and improves living standards. This makes Ijara not only a convenient but also a socially responsible tool.

Thus, Ijara is not just a lease with a purchase option. It is a thoughtful, fair, and modern form of financing that meets both the spiritual and practical needs of a person.