 In this module, we would further look into the uses of murabaha in the context of Islamic banking and finance. But before we do so, let us look at the classical murabaha once again. As I said, in case of classical murabaha, the basic requirement was disclosure of the profit. So this is a sale contract between a seller and a buyer such that it is a requirement for the seller to disclose their profit. And of course, in most cases, this was a spot sale. And someone may say that what was the purpose of this one? Why would someone who is selling something to a prospective buyer tell the cost of procurement of that item? Why would someone disclose the profit? In Pakistan, the shopkeeper does not disclose his profit. In many cases, he does not disclose his profit as much as he does. So in case of murabaha, why is there this requirement that the profit should be disclosed to the buyer? Are there any examples? Basically, this contract was used for the items for which there was no established market. For example, a merchant comes to the Medina market in the evening and he tries to sell such things in the market. He says that this is to sell. It is a beautiful thing. It can be a leather-based product or a precious stone that no one has seen before. But he does not know what its price is. So if someone is interested in buying that item and they have no idea what is the fair price of this one, they can always ask the seller, tell us how much did you pay for it? So this was actually the intention behind the contract of murabaha. In economics, we call it the murabaha actually allows the buyer and the seller to reduce information asymmetry. The seller knows a lot more than the buyer. So this information asymmetry is there. The contract of murabaha makes this information asymmetry less, which is efficiency enhancing. So this is one classical example of the use of murabaha. In modern context, most of the intra-group transactions, the big industrial group, have many companies in one group. So even the companies that do something together, they are the same people. However, these companies within the group, they are different. And in order to make sure that there is no tax evasion or something innovative with the accounting practices, the regulators or the tax guys, they require that whatever transactions or some transactions which you do in the form of intra-group transactions, they should be based on cost plus basis. i.e., they should be on murabaha basis. Now, we looked into home financing product, for example. There are some car financing products available in the market on the basis of murabaha, and we would look into this in one of the forthcoming modules. But let's look at the agreements and contracts which are used in murabaha as a mode of finance. Murabaha, not as a contract. Contract, we have said, is a very simple contract in which the seller has to tell the profit. However, murabaha as a mode of finance, this is a lot more complicated than the murabaha as a contract. Now, what happens in this? There is an application form in this. The finance seeking party would have to fill in this application form. There is an undertaking in this. And we mentioned this purchase undertaking in the context of home financing. This happens in car financing too. Murabaha sale and purchase agreement. This is another very important contract. Sale and purchase agreement between the bank and the vendor. In some cases, there is Wakala agreement as well. Now, the bank may appoint the customer as its agent to buy the house and then sell it to himself on behalf of the bank. And similarly in case of cars as well, there is Attaqaful arrangement part of the deal as well. Collateral agreement, bank would like to make sure that the money is returned to it so that collateral agreement is there as well. And then there are some general terms and conditions which the customers have to sign. In general terms and conditions, what happens? It happens that you will give us money on time and you will not sell these things that you have bought on Murabaha. So these kind of general terms and conditions are there as well. Now, in case of the customer and the bank, application form, purchase undertaking, Murabaha sale and purchase agreement, Wakala agreement, collateral agreement, general terms and conditions, these are between the customer and the bank. And the bank and the vendor has this sale and purchase agreement and transfer of liability agreement. This is very important. Transfer of liability means what? Now, in case of a car dealer, for example, the bank actually buys the car from the dealer and this warranty and guarantee card, all these things are in the name of the bank. The bank would not like to be part of the equation once it has sold the item to the customer. So they actually inform the dealer or the manufacturer that actually this is our intention. We are buying it from you. However, we are going to selling it on to someone else. So all these things, guarantees, etc., they should be in the name of the ultimate customer. So transfer of liability agreement in many cases is very relevant. Now, although this is not part of the Murabaha deal, however, a bank may not provide you financing on the basis of Murabaha if you haven't got insurance or if you do not intend to have Islamic insurance slash Takaful. So that Takaful agreement is between you and the Takaful operator. So there are, as you can see, there are so many contracts involved in case of Murabaha as a mode of financing. Now Murabaha as a mode of financing is not just simple Murabaha contract. It involves so many arrangements. It combines so many relationships only then an Islamic financial product based on Murabaha as a mode of financing comes into the market.