NOTE: words of Arabic origin are transliterated from the Arabic script to Latin script. Multiple possible spellings may exist.
Baitulmaal (social treasury)
A fund designed to provide economic assitance to the less fortunate.
BMT (Baitulmaal wa Tamwil)
A financial institution which utilizes capital from a myriad of charitable and commercial sources to provide social welfare grants, business opportunities, and financial guidance to the poor, as well as providing financial services to solvent parties.
Da’wah (call towards religious teachings)
also: daawa, dawah, daawah, or dakwah
An invitation to islam via the expression of islamic teachings and principles.
Eid (religious festival)
also: id, eed
Islamic religious celebrations, namely Eid al-Fitr or Eid al-Adha.
A ruling on an issue given by a recognized authority of islam based on ijtihad.
Hadith (recorded sunnah)
Recorded traditions of the prophet Muhammad ﷺ (sunnah) which are the primary source of guidance for muslims other than the Quran.
Anything not deemed impermissible or disliked by God through the revelations made to the prophet Muhammad ﷺ.
Hajj (greater pilgrimage)
also: Hadj, Hadji, or Haj
Mandatory pilgrimage made by muslims to Mecca during Dhu al-Hijjah (the last month of the islamic calendar), which is incumbent upon all muslims who are financial capable of doing so.
Anything deemed impermissible by God as revealed to the prophet Muhammad ﷺ.
Umrah (lesser pilgrimage)
Non-mandatory pilgrimage of muslims to Mecca that can be done at any time of the year.
See also: hajj
Ijarah (rental agreement)
Temporary endowment of goods or services for a fee.
See also: Introduction to Ijarah (Lease) Contract
Independent reasoning based upon an islamic scholars understanding of Quran and Sunnah.
Infaq (charitable spending)
Spending or disbursements with the intention of pleasing Allah (swt) without expectations of rewards in return.
A contract guaranteeing the signer performs what is promised.
A muslim place of worship
Mudarabah (profit/loss sharing)
An investment, similar to stock company, that is more like equity than debt. Where a 'silent partner' AKA investor AKA capital provider known as the 'rab-al-mal' invests his money and an entrepreneur known as the 'mudharib' invests their time and effort.
If the business is successful, then the profits are shared between the investor and the investor at predetermined percentages. (profit sharing)
If the business goes bankrupt, then the entrepreneur loses their time and the investor loses their money. (loss sharing)
See also: mudarabah
Mudarabah-Musharakah (plural partnership)
Like mudarabah, except where the mudharib invests some of their own money into the business.
A sale for cash or a deferred price, where acquisition cost and profit are disclosed.
See also: murabaha
Musharakah (joint venture)
A Partnership or joint venture, similar to mudarabah, in that it is more like equity than debt, but where both parties are involved in running the business.
See also: musharakah
Qard (gauranteed repayment)
A gaurantee by which a borrower will be bound to repay the lender an equivalent replacement amount.
Riba (fixed interest rates)
Fixed rates of interest charged by money lenders, also knon as usury.
See also: riba
Sharia (islamic law)
also: shariah, shari'ah
Islamic law derived from the Quran and the sunnah of the prophet Muhammad ﷺ.
also: sadaqa, sadaqah
Voluntary charity paid at will and at the amount decided by the benefactor.
Sukuk (islamic bonds)
Much like traditional bonds except that they reflect an ownership of assets and not a debt obligation.
Sunnah (traditions of the prophet Muhammad ﷺ)
The actions, words, and teachings of the prophet Muhammad ﷺ as recorded in authentic hadith.
Tamwil (commercial funding)
Capital designated to fund commercial businesses.
A deposit given in trust to be held for the owner for a temporary period of time.
Wakaf (a charitable endowment of property)
also: waqaf, awqaf (plural)
an endowment of property, given by a muslim in trust to be used for religious or charitable purposes with no intention of the assets being reclaimed.
Zakat (obligatory charity)
A compulsory charity paid by muslims that amounts to 2.5% of their cumulative yearly wealth.