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Concept Of Promise In Islamic Finance
What is the concept of the promise in Islamic finance?
Although Islam prohibits the execution of a future sale, it is permissible to make a promise for a future sale. For instance, if a sales transaction for a car that will be delivered a month later cannot be executed, a promise may be made for its future sale. It is important to note that the promise and the actual contract of sale be independent of one another. A promise is legally binding and accompanies stipulations which serve as deterrents to default. In turn, this requires the client to make good on any loss that the bank may face as a result of a breach.

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