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KembaraXtra – Islamic Finance: Tanāzul vs Ibrā’
Tanāzul (Waiver)
- Definition: Voluntarily giving up a right or entitlement.
- Nature: Applies to rights/benefits (e.g., profit share, rental rights).
- Example: Investor waives part of her profit in favour of the fund manager.
- Trigger: Done voluntarily by the rights-holder, either upfront in agreement or later.
- Legal Effect: Permanently removes the right of the waiving party.
- Shari’ah Ruling: Permissible as long as voluntary and does not harm others.
Ibrā’ (Rebate/Discount)
- Definition: Voluntary reduction or forgiveness of a debt/monetary obligation.
- Nature: Applies to debts/outstanding payments.
- Example: Bank grants a rebate when a customer repays financing early.
- Trigger: Arises when the debtor repays or struggles to repay; must be at creditor’s discretion.
- Legal Effect: Reduces or cancels the debtor’s liability.
- Shari’ah Ruling: Permissible, but cannot be pre-agreed in contract (to avoid gharar).
Summary:
- Tanāzul = waiving rights/entitlements.
- Ibrā’ = waiving debts/obligations.
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