Murabaha: an ethical alternative to traditional loans

With the growing interest in ethical and socially responsible forms of finance, Islamic finance is gaining popularity. One of the key instruments of Islamic finance is murabaha, which offers an alternative approach to lending. This article explores the principles, structure and application of murabaha to provide the reader with an understanding of its features and role in the modern financial system. It describes how murabaha ensures transparency and fairness in financial transactions, and also provides an alternative that complies with religious norms prohibiting interest-based lending.