About Term Financing-i Secured by ASB/ASB2 Certificate
What is Term Financing-i Secured by ASB/ASB2 Certificate?
Term Financing-i is a financing facility where the profit is calculated on variable rate. You are offering your Amanah Saham Bumiputera (“ASB”) certificate or Amanah Saham Bumiputera 2 (“ASB2”) certificate as a security for this financing.
This product utilises Shariah-compliant commodity in its transactions to provide financing to you.
Highlights of this product: This product is calculated based on Standardised Base Rate + spread per annum.
Note: The monthly instalment may be varied due to the fluctuation of Standardised Base Rate (SBR).
What is the Shariah concept used?
The Shariah concept applicable are Tawarruq. Shariah concept of Murabahah, Wakalah and Wa`d are also applied.
Tawarruq
Tawarruq means an arrangement that involves two sale and purchase contracts. The first involves the sale of the commodity by the Bank to the customer on deferred payment at cost plus profit basis whereby the purchase price and the sale price are disclosed to the customer. Subsequently, the customer will sell the same commodity to a third party on cash and spot basis.
Murabahah
Murabahah refers to a sale and purchase of a commodity where the acquisition cost and the mark-up are disclosed to the customer.
Wakalah
Wakalah refers to a contract in which a party as principal (muwakkil) authorises another party as agent (wakil) to perform a particular task in matters that may be delegated, with or without the imposition of a fee.
For this product, you appoint the Bank as an unrestricted agent to perform the Tawarruq arrangement.
Wa’d
Wa`d is a unilateral promise which refers to an expression of commitment given by one party to another to perform certain actions in the future.
The Tawarruq arrangement shall be as follows:
You appoint the Bank as your agent to purchase Shariah-compliant commodity such as Crude Palm Oil (CPO) etc, from the Bank and to sell the commodity to any third party.
The Bank sells the agreed commodity to you at the Bank’s Selling Price on instalment.
As the purchaser of the commodity, you shall have the right to take delivery of the commodity at your own cost and expenses.
The Bank sells your commodity on your behalf to any third party for a price equal to the Facility Amount.
The proceeds of the sale shall be disbursed to you as per the agreed terms and conditions.
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