Hamish Jiddiyah

Shari'ah Standard 8 of the AAOIFI Standards explains it as follows: 2/5/3; It is permissible for an institution, in the case of a binding promise by the customer, to take a sum of money as hamish jiddiyyah (i.e., a security deposit). This is to be paid by the customer at the request of the institution, both as an indication of the financial capacity of the customer and to ensure the compensation of any damage to the institution arising from a breach by the customer of his binding promise. For further details, see ISRA research paper No: 46/2012


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