Wadiah and Ujrah Issue in Al-Rahnu Product: A Turning Point to Tawarruq Structure

Vol. 12, No. 8, 2022, Pg. 913 926 Abstract The issue of wadi’ah and ujrah has long been discussed by scholars in the past by dividing them into two different types of contracts, namely mu’awadat and tabarru’at . They agreed that these two contracts have different characteristics, where mu’awadat is to generate profit while tabar ru’at is a purely charitable contract. Thus, this article aimed to review why this combination is a non- shari’ah compliant and therefore, a replacement with another shari’ah structure becomes an essential. This study uses qualitative approach where interviews and content analysis are conducted and several books of fiqh from the four schools of thought are examined. The frequency of words by using some identified terms such as wadi’ah, rahn, ujrah, mu’awadat and tabarru’at are determined and coded to form the tendency of fiqh views whether it support the objective or against it. The study shows that modern scholars have a tendency of shared similar views and they found these two covenants ( wadi ʿ ah and ujrah ) have been mixed in the same product namely ar-rahnu and this has raised the issue of shariah. They argued the safekeeping of collateral is applied based on the principle of wadi ʿ ah where they impose a fee for the service that is rendered. This kind of fee is charged under the principle of ujrah . However, this connection gives rise to the indirect implications of bayʿ wa salaf and qard jarra manfaʿah , that are prohibited in shari ʿ ah. Therefore, the tawarruq is so much better option to replace the wadiah-ujrah principles. This study uses qualitative approach where content analysis is conducted. Several books of fiqh from the four schools of thought are examined. This study uses several books of from the four schools of thought are examined. The books are Hasyiah Rad al Mujtahid The


Introduction
The criticisms over this concept have been widely discussed and written. Some scholars are consistently agreed about the unnecessary concept of ujrah to be embedded in al-rahn product, as they stated that al-rahn is only served for securing the debt and is not a method for generating the profits. In fact, they analyzed the concept of ujrah is a part of sale contract under bayʿ manfaʿah (sale of usufruct) and thus, it is prohibited to be applied with the qard (loan) contract. It is understandable due to the reasons why the concept of ujrah is wrongly used in al-rahn product, as there is a hadith that prohibits such practice as following: "Do not allow a loan (in combination with) and a sale, do not have prerequisites to sell, do not gain a profit if it is guaranteed, and do not sell what you do not have" In a hadith narrated by Nasa'i also stress the same thing with different words: "Ismaʿil bin Masʿud had told us from Khalid from Hussein al-Muʿallim from ʿAmru bin Shuʿayb from his father from his grandfather: Verily Rasulullah forbids combination of salaf (debt) and sale, two conditions within a sale, and profit as long as it not guaranteed (without taking a risk)." In addition, the scholars argued that the safekeeping fee imposed by the institution exceeds the reasonable rate of that safe deposit box, hence it corroborates the presence of riba elements. This higher rate of fee can be seen through the calculation of annual fee against the loan that is given at 13% in banking institutions, and 11.9% as the average charge in a whole al-rahn shop owned by the cooperative societies. Even though the rate seems higher, the product is widely engaged by the small middle-income group and makes it relatively expensive for them. Moreover, the scholars also stressed that the product received an overwhelming response from the public as it has unique and attractive elements such as a quick approval, rollover functionality, and a guarantee of getting back the pawned jewelry. This situation however reveals the real motives of customers who are willing to pay more safekeeping fees than they really should, and that they subscribe to al-rahn product merely for the purpose of obtaining the financing facility.

Literature Review
While the discussion of al-rahn is intensively discovered, the concept of wadiʿah in Islamic law shall be collectively understood in clarifying the issue of compositing al-rahn and wadiʿah. According to the Hanafiyy School, the contract of idaʿ is defined as authorizing another party to safeguard one's property by either declaration (sarahatan), or indication (dilalatan) (Ibn Nujaym, n.d, Al-Sarakhsi, 2000). The same basic conditions (shurut) are governing a standard contract that applies to wadiʿah (Al-Kasani, 1971). This includes the sanity (ʿaql) of the contracting parties and their majority (bulugh̲ ). However, the Hanafi do not stipulate the adulthood of both parties and accept that a minor who has permission to trade (sabi ma'dhun) is able to deposit his property freely. Another condition is that the object of the contract should be legal (mal mutaqawwim). Accordingly, "only property (mal) can be deposited" applies once it is understood that the mal is not the focus of the condition, but that the legality of the mal is involved (Dien, 2012). Thus, wine is not a legal item as property for an ordinary Muslim, nevertheless, if it is owned by a newly converted Muslim, it is considered legal. The final, standard contractual condition required for idaʿ is the offer by the depositor (mudiʿ), and acceptance by the depositary (mudaʿ). The obligations of the depositary dictate that he or she should safeguard the object to the best of his or her ability. When liability is to be assessed by the court, the safekeeping expected would be normally accepted for similar objects. Liability can only be granted to the depositor if negligence or transgression (taʿaddi) is proved (Al-Kasani, 1971). In practice, if a person deposited the thing with a third person, for the depositing is based on the personal confidence which the depositor has placed in a definite individual known to him, Ibn Abi Layla alone allows the depositary to redeposit (Al-Sarakhsi , 2000). The opinions differ regarding further depositing with members of the family. Members of the family are such people who live with the depositary, and belong to his household, wife, children, parents, and servants. The Shafiʿiyy jurists follow qiyas (analogy) and forbid further depositing, while the Hanafi and Maliki who follow Istihsan allow it. According to all schools, the depositary may deposit again in face of pressure from a higher power to save the thing deposited. In cases of such kind, given examples would be shipwreck, fire, inundation and enemy raids.

The Combination of Wadiʿah and al-Rahn
In an interview with UIM researcher that was conducted in 2019, he consistently rose the issue of using similar jewelry in two different contracts of two different contracts' objectiveness which are wadiʿah and al-rahn (Fairooz, 2019). This structure could lead the contradicted interests and purposes. The diagram below shows the conflict that occurs when these two contracts are combined.  Figure 1 designates the flow and the implication of al-rahn and wadiʿah's composite contract when it is imparted into pawning product. The flow starts with the engagement of qaṛd contract before an institution holds the jewelry as the collateral under al-rahn contract. At the same time, an institution keeps the pawned object under the contract of wadiʿah. Since the collateral and the consigned object are just similar, it creates a conflict in the contract objectiveness (muqtada al-ʿaqd). The example of such conflict occurs when the contract of wadiʿah allows the depositary to reclaim the goods kept by a trustee at any time, while the contract of al-rahn does not apply it. When the collateral in al-rahn contract only can be redeemed after the completion of debt repayment or purchase installments, the consigned object cannot be recollected before that period even if the safekeeping fee is settled. This is due to the acceptance of a similar object in both contracts; rahn and wadiʿah. The inability of recollecting the consigned object is against the opinion of Ibn Hazm about wadiʿah, as he stated: "It is compulsory upon the trustee who was entrusted with a wadiʿah to preserve it and to return it to its owner whenever he (saver) asks for it" (Ibn Hazm, n.d). Ibn Qudamah also mentioned about this matter as he said: "It is a non-binding contract that involved by two parties. Whenever the depositary (mudiʿ) wants to take the saved item, it is compulsory for the trustee to return it"(Ibn Qudamah, 1405H). The above arguments indicate that the current practice of joining rahn and wadiʿah contract on the same item disrupts one of the indispensable structures of wadiʿah. The depositary (mudiʿ) cannot claim a deposited good since it is yet a collateral in the meantime, which grants the creditor the right of confinement. In this case, the owner can only be entitled with the good after reimbursing the debts to the creditor, or the trustee (Fairooz, 2012). Even the later enhancement is suggested by introducing the concept of wadiʿah bi ajr and followed by rahn al-wadiʿah; Mohamed Fairooz Abdul Fairooz a senior researcher of ISRA during the interview conducted in 2019 said, that the structure was rejected by Majlis al-Ulama' Li ISRA (the ISRA Council of Scholars). They justify that the debtor will not keep his/her jewelry under the principle of wadiʿah unless the debtor will receive an offer of loan from the institution. In understanding the position, the diagram above describes how the original principle of wadiʿah is conflicting with the principle of damanah. The above diagram shows the flow, principle, and the implication of three contracts: ar-rahn, wadiʿah, and damanah. It conflicts when the element of trust, which constitutes the original principle of wadiʿah contract is conflicting with the principle of guarantee in damanah contract. The principle of amanah displays the custodian that he is not liable to guarantee the consigned object under his/her custody, in case of damage or loss, if the negligence (taqsir) or the transgression (taʿaddi) does not occur. In this regard, changing original feature of wadiʿah from being a trust-based contract to a guarantee-based contract is being concerned. According to the Shariʿah Board of AOOIFI, the stipulation of guarantees in trust (fiduciary) contracts -agency contract or contracts of deposits -is not permitted as it goes against the nature of trust, unless such stipulation is intended to cover cases of misconduct, negligence, or breach of contract (AOOIFI, Guanrantees, 2010). The current practice of al-rahn at the institutions reveals the changes of the element of trust (amanah) in a wadiʿah contract, to the element of guarantee (damanah). This occurs since the service charge is being imposed for safekeeping customers' goods. Nevertheless, this ruling is based on Hanafi's view, that an imposed fee for safekeeping a wadiʿah object will change the original status of wadiʿah as a trust-based contract (amanah) to a guarantee-based contract (damanah). This change marks the term that is known as wadiʿah yad damanah. Eventhough, the issue of wadiʿah yad damanah is resolved through Hanafiyy ruling, other issues arise when a further conflict occurrs between the contract objectiveness (muqtada al-ʿaqd) of wadiʿah yad damanah and rahn. The contract objectiveness of rahn is primarily based on trust (amanah), which does not admit any form of guarantee (daman), while wadiʿah yad damanah requires a custodian to guarantee a deposited item kept under his/her custody as a counter-value for the fee paid by the customer for safekeeping's service that are to be rendered. The position of al-rahn as a charity-based contract must not be literally concluded, as the earlier scholars had discussed this in an extensive and comprehensive version. For instance, Qadi Zadah argues with Hanafi's justification about al-rahn as a charitable contract; he claims that the inconsistency of the charitable action is occurred along the process of contract. He claims that al-rahn contract inclines more towards a form of muʿawadat (exchange) rather than tabarruʿat (charity), as the creditor or the value of the collateral may become a guarantor or a guaranteeing object to a damaged or lost collateral. It the case of object's damage or Principle loss, it can be considered as the settlement of the debtor's debt. As such, the offer of submitting jewelry as a collateral by the debtor must be clearly accepted by the creditor, so that the debtor can be attached by the responsibility for any risk of damage or loss (Ibn Hammam,d.681h:0:137). This view has also been shared by al-Kasani as he says that one who has reached puberty, a free man, a child and a slave who has his guardian's consent, are allowed to execute al-rahn contract since they are all already eligible to own a business, including pawning activities (Al-Kasani, 1971). As for Al-Buhuti, he views al-rahn as not being compulsory to secure a debt and the parties in the contract are merely based on the principle of charity (Al-Buhuti, 1947). However, others regard it as muʿawadat, which is an exchange-based ownership contract in which the benefits of the contract are obtained by both contracting parties (Kuwait, n.d.). Nonetheless, al-Kasani explains that there is an evidence which shows that al-rahn is neither fully muʿawadat nor tabarruʿat. He claims that the action of giving and receiving the collateral is not an exchange for something. At the same time, the purpose of securing a debt is also not an option. The jurists of Hanafiyy said that the creditor has a right to demand his right by selling the pawned object that he is holding if the collateral is not perished. If the collateral perishes, the function of al-rahn as a debt's security will end (Al-Kasani, 1971). Al-Rafiʿi of Shafiʿi said that al-rahn remains tabarruʿ even though it is stipulated by the conditions in the contract or any other contract (Al-Rafiʿi, 1997).
In conclusion, there are two rulings regarding ar-rahn's status. Firstly, that al-rahn is a charitable (tabarruʿ) contract and secondly, that al-rahn can be changed to muʿawadat (exchangeable) contract such as a sale or a lease, if it is stipulated by a required condition. These rulings are in turn associated to further effects, as well as the agreed and disputed condition. The agreed condition refers to the unanimous agreement of its ruling, while the disputed condition is the undecided or individual agreement of its ruling. The three conditions that result in the agreed rules of al-rahn-as discussed by the jurists -are the condition required by the contract, the condition that is contrary to the contract objectiveness and the condition neither required nor contrary to the contract's objective. The first condition requires the debtor to place a collateral to the possession of the creditor and he may sell it after the expired period of redemption. In this case, the creditor can stipulate a condition in the contract by giving him primacy over other creditors, through the possession of collateral on which he has the first right to extract what is owed to him. The second type is that the debtor requires the creditor not to hold the collateral; not to sell it after the expired period of redemption; or in the event of a default. Else, the debtor may not give primacy over other creditors in settling the latter's debt. In this situation, all scholars from Hanafi, Maliki, Shafiʿi and Hanbali unanimously agreed that such condition is unlawful. However, they differed in opinion about the whole contract's effect, whether it is defective (fasid) or terminated (batil). The third type is the condition that is based on maslahah 1 (Khadduri n.d.), which merely aims at strengthening the existing requirement. For example, a testimony of ar-rahn, al-rahn in a sale contract and al-rahn with compensation. These additional elements are neither necessary nor unnecessary to al-rahn contract. All scholars of Hanafi, Maliki, Shafiʿi and Hanbali agreed that this condition is lawful and the contracting parties should fulfill it or otherwise one of the parties involved can terminate the contract.

Methodology
This study uses qualitative approach where content analysis is conducted. Several books of fiqh from the four schools of thought are examined. This study uses several books of fiqh from the four schools of thought are examined. The frequency of use of some identified terms such as wadi'ah, rahn, ujrah, mu'awadat and tabarru'at are determined and coded to form the tendency of fiqh direction. The study mentioned the views of the four main schools of jurisprudence, starting with the initial order of existence. Thus, the Hanafi legal school will be reflected first, followed by the Maliki, Shafiʿi and Hanbali, without considering the strengths of each view. It also referred to the other schools of thought if they are consistent with the Islamic general principles and the view of ahl sunnah wa al-jamaʿah. However, the use of schools other than the main four schools is extremely rare. The study also presented genuine evidence and discussions by highlighting the solutions and conclusions for each evidence presented. However, the study would not make conclusions in the absence of any guidance in resolving a problem. The study limits the strongest view for each school of thoughts and sometimes, the view of a particular one would be mentioned more than once, if there is a need for it. In discussing the issues of al-rahn, it is important to divide the subject into further classifications, so that it shall be comprehensible. If the discussions about al-rahn are dragging and not focusing, this would complicate the path of understanding to real problems. The study also conducted semi-structured interviews that based on (Wilson, 2014). A semistructured interview combines the open-ended exploration of an unstructured interview with predetermined questions like those used in structured interviews. Interviewers that use the semi-structured interview method usually follow a document called an interview guide. The semi-structured interview's overall purpose is to collect systematic information about a handful of major subjects while also allowing for open-ended questions as new issues or themes arise, some investigation. The interviews conducted with some scholars who have knowledge regarding related topics and related industries such as ISRA and INCEIF Researchers, Shariah Committee and Operators for IFI Conducting ar-Rahnu product.
What are the risks faced by the bank when the product of Ar-Rahnu will be changed its structure to the exchange contract (mu`awadat) such as tawarruq? Describe the situation.
Is there any possibility of tawarruq structure (if applicable to the product ar -Rahnu) are excluded from the credit assessment?
Of many issues involved, which are the one of concern to al-rahn product?
What are the negative factors possibly happened in al-rahn product that could make it unattractive? Describe the situation √ x The outcomes of the interviews are then described in the diagram below. The safekeeping of collateral is applied based on the principle of wadiʿah where they impose a fee for the service that is rendered. This kind of fee is charged under the principle of ujrah. However, this connection gives rise to the indirect implications of bayʿ wa salaf and qard jarra manfaʿah, that are prohibited in shariʿah. In this regard, a deeper debate involving these two principles (ujrah and wadiʿah) is therefore explained and analyzed.

Figure 4: Existing structure of tawarruq and rahn
At the first stage, the customer approaches the institution for cash financing. The institution then assesses customer's ability of engaging in such contract. However, this stage is practically critical, because most al-rahn institutions are not assessing customer's credit ability in repaying the debt. The absence of customer's credit assessment is a great turning point for the success of this suggested structure. Thus, the exemption or very minimal assessment, which takes very short time is a must condition. (1) The institution buys a commodity from Broker A upon client's request; normally, this process of buying a commodity is done through Suq al-Silaʿ or Commodity Muṛabahah House. This trading platform that uses crude palm oil as the underlying commodity is introduced by Bursa Malaysia in 2009 to facilitate Islamic financia1 transactions, particularly the application of commodity muṛabahah which is based on the principle of tawarruq. Usually, this process will include buying and selling transactions in ten minutes, since it is applied through the system in computer (2). The institution sells the commodity to the customer at a mark-up price, and the customer pays the price in deferred payment basis, based on six months or above according to the agreed terms and conditions of the contract. (3) The customer's jewelry is pawned to the bank based on rahn contract in lieu of a debt, which he/she pays in the deferred time. (4) The customer appoints the institution as his/her agent to sell the commodity to a third party for getting the cash. This process is also conducted through mechanism of Suq al-Silaʿ, or Commodity Muṛabahah House. Once again, at this stage the institution must find a way for the exemption of wakalah fee that is resulted from the appointment of bank as the customer's agent. This fee may discourage the customers as the institution is already making a profit from the mark-up price. (5) As an agent, the institution sells the commodity to the third party, who is known as broker B. But this time, the selling price is based on the current market price that makes the difference of what customer should pay to the institution. (6). The difference that creates the cash will then be given straight away to the customers or credited into customer's account depending on how the institution wills to disburse it. (7) This structure suggestively allows the institution to generate a legitimate profit, as it does not involve qaṛd as the underlying contract for profit generating. In fact, the profit is purely generated from a mark-up sale via tawarruq arrangement that the parties entered. However, this structure associates the issue of organized tawarruq (tawarruq munazzam), which is controversial in terms of its legitemacy. In principle, the majority of Sharicah scholars approve the permissibility of the classical tawarruq contract. However, they are far from unanimously agreeing with the legality of organized tawarruq (tawarruq munazzam) as practiced in contemporary Islamic finance. Those who allow it stipulate specific conditions to avoid prohibited elements such as the three-way ʿinah. The modern scholars who reject the current practice of organized tawarruq argue that it is a legal trick to circumvent the prohibition of riba. In counting back those arguments, this selected structure shall depend on the following justifications.

Discussion
This structure suggestively allows the institution to generate a legitimate profit, as it does not involve qaṛd as the underlying contract for profit generating. In fact, the profit is purely generated from a mark-up sale via tawarruq arrangement that the parties entered into. However, this structure associates the issue of organized tawarruq (tawarruq munazzam), which is controversial in terms of its legitemacy. In principle, the majority of Sharicah scholars approve the permissibility of the classical tawarruq contract. However, they are far from unanimously agreeing with the legality of organised tawarruq (tawarruq munazzam) as practiced in contemporary Islamic finance. Those who allow it to stipulate specific conditions to avoid prohibited elements such as the three-way ʿinah. The modern scholars who reject the current practice of organised tawarruq argue that it is a legal trick to circumvent the prohibition of riba. In counting back those arguments, this selected structure shall depend on the following justifications: 1. An absence of ownership transfer Many institutions are reluctant to own the jewelry that has been transferred to their ownership due to the cost, and operational risk's factors. On the other hand, the composite contract of tawarruq and rahn as what is suggested in this work, does not involve the transfer of the jewelry's ownership to the institution and this can reduce their risk of market's deficiency for resale. The reselling of the jewelry can be harder market for the institution to deal with, since it has now become a used item and the buyer will percieve it as a cheaper item. This situation occurs when the original seller fails to repurchase the sold jewelry in the first contract of bayʿ saṛf, which has taken place earlier. It also reduces the risk of the institution against losses resulting from the gold price fluctuations in the market. Thus, this structure make the jewelry to be functioned as a security to the commodity's trading activities executed at bursa suq al-silaʿ in a tawarruq contract, instead of just being an object of matter. 2. The rahn based product should carry the real concept of ar-rahn Although, there are a variety of products sharing the same principles of shariʿah, or products that have shared the same name by using different shariʿah principles, yet it is hard to compare with the product of al-rahn itself. The customers always perceive the rahn based product as their source of instant cash. Thus, their jewelry held by the institution cannot be considered as a transfer of an ownership, as it would alienate the customers and discourage the policy makers of the institutions (as what structured in bay sarf). Either the clients or the institutions do not percieve pawning as the main contract, but rather a derivative mechanism to the contract of debt; this perspective is in line with the original ruling of shariʿah about arrahn. If the pawned jewelry is not deemed as collateral in lieu of a loan given, but a contracted matter in a sale contract as what has proposed in bay al-sarf, then al-rahn product is pointless as the product's label carries the element of pawning. People will get jumbled if the term 'pawning' only appears as the product's label, and afterwards the item's ownership goes through the legal impact that is affected by the product structure. Therefore, the structure of the product must reflect the actual concept that is supposedly meant for, or else it should be ready for the product rebranding; it will cause transformation on a massive scale for hundreds of the existing al-rahn institutions. Alternatively, the jewelry is remained as a security item for the main contract, either the debt or through sale agreement if the structure of tawarruq -that is backed by rahn -is executed. 3. The stronger connection of qard and sale The Islamic scholars acknowledge that the structure used today has a link with the prohibition of bayʿ wa salaf as mentioned in the hadith. Even though the connection between the concept of ujrah and qard indirectly links to the product, yet it has a significant dependency upon each other. This happens since the object is served for two different contracts, which vary in nature and its contract objectiveness. Moreover, some institutions have distinguished the rate of ujrah fee for the pawned jewelry; with or without the offer of loan. For example, Ar-Rahnu KPMNJ charges RM0.15 as ujrah fee for each of RM100 of marhun value without a need to borrow cash, while imposing a higher rate of RM0.70-0.75 if a customer needs cash. This clearly shows a significant relationship between the existence of ujrah and the existence of loan. Furthermore, a study done by Fairooz shows, that there is an unnecessary inclusion of principles in the product which are ujrah and wadiʿah. He held that the unnecessary inclusion of a contract in a deal is an indicator of the presence of a hilah element (Fairooz, 2010), and for this particular case, the structures including the principles of ujrah and wadiʿah are unnecessary. This occurs since the original concept of rahn has already covered the function of ujrah and wadiʿah. 4. An instrument of tawarruq is not prohibited One may argue that tawarruq structure has a problem from the viewpoint of some contemporary fiqh scholars. However, the scholars who disagree about the current practice of an organized tawarruq claimed that it is a legal trick to escape from the prohibition of riba. They took the resolution of Majmaʿ Fiqh as a basis of their claim (The International Council of the Islamic Fiqh Academy, 2009). In response, Laldin (2014) insisted that the resolution of Majmaʿ Fiqh -which refers to the prohibition of the use of tawarruq instrument -is not binding. Furthermore, the contemporary scholars such as Shaykh ʿAbd al-Sattaṛ Abu Ghuddah, Shaykh Niẓam Yaʿqubiyy and Dr. Mohamed A. Elgari disagreed with the ruling. This resolution is then being refuted by the Shariah Standard 2010 that permitted such practice. There are many scholars who allow such practice, as they claim that the current structure of tawarruq which is implemented in the institution is excluded from what the resolution has concluded. They define that tawarruq munaẓẓam is an arrangement in which the contracting parties have no choice, but to follow only the specified transaction flow from head to toe; for instance, just as the delivery or the sale of goods to the other parties is not allowed (Hashim, 2014). Based on an interview with Ashraf bin Md. Hashim, a Profesor and Senior Researcher at ISRA on the 14th of January 2014 about tawarruq executed in Malaysia's financial institution, it was discussed that if the buyer at any level has a complete freedom in tasarruf -either to take delivery, or sell goods to any party -then it is not included in the "tawarruq munaẓẓam". The Bursa Suq al-Silaʿ in Malaysia is given this liberty; thus, his viewpoint of such practice is not included in tawarruq munaẓẓam. Moreover, they also viewed that these instruments are included in the category of makharij , which is supposed to be temporary (Hashim, 2014). 5. A permitted tawarruq structure is guided by the specific condition as resolved by AOIFI Shariah Standard AOIFI Shariah Standard had permitted such practice; general evidence can be traced in the texts of the Quran and the Sunnah that permit sale transaction (AOOIFI, 2010). It has also been confirmed by two resolutions issued by; the Islamic Fiqh Academy of the Muslim World League; the Standing Committee of the Supreme Board of Sharia Scholars of the Kingdom of Saudi Arabia (Fatwa No. 19297); as well as the fatwas of several shariʿah supervisory board. Therefore, tawarruq is an exit for avoiding riba rather than a trick for performing it, since it is usually practiced by those who do not want to be involved in interest-based borrowing. It has been reported by ʿAbd Allah Ibn Mubaṛak that Sayyidah ʿA'ishah (God bless her) practiced it. However, its permissibility depends on the specific condition that must be fulfilled by the transacting parties. Among others are: i.
The prohibition of composite contract between purchasing the commodity and reselling them, which is justified by the fact that joining them together would impose a commitment on the client to sell the commodity right away. Hence, such immediate transfer of the ownership of the commodity may not enable the client to receive it. This is again the same reason for prohibition of proxy-related commitment. ii.
The permissibility of resorting to the proxy of the institution when the client, by virtue of law, is unable to sell the commodity directly is meant to safeguard the deal from being nullified by the law. iii.
The ruling that institution should provide detailed information about the commodity to the client, aims at preventing the fictitious transactions and helping the client to obtain the liquidity. Such requirement holds true; whether the subject matters are in the form of a commodity, car, and shares of a company, international goods, or local goods. The latter are more suitable for monetization due to the easiness of ensuring their existence and the chance available to the client to actually hold them, if he so desires. iv.
The ruling that the institution should provide the client with full description or a sample of the commodity is actual, rather fictitious. v.
Monetization should be subjected to strict controls and restrictions, so that institutions fulfill the main objectives underlying their presence and the interest of customers to make dealings with them.
The institutions have to show strict commitments towards using modes of investment and financing such as; the various form of mushaṛakah and exchange of goods; usufruct and services that conform the very nature; and basic activities of Islamic banking. Hence, imposition of controls and restrictions on monetization would curb any tendency for expanding the monetization, except in the limited scope defined in the AAOIFI Sharia Standard 2010.

Conclusion
In conclusion, this structure has manifest gains over other structures that have been earlier debated. The use of rahn in this structure consistently meets the purpose for which the rahn contract was constituted by the Shariʿah, i.e. as an assurance contract. In this structure, profit generation is placed in the right position, which is a trading contract, while al-rahn remains a trust-based security contract. Thus, this structure does not try to employ rahn for a purpose that contravenes the very nature of the rahn contract, and its objectiveness. As a result, this structure is ultimately safe from the prohibited elements of bayʿ wa salaf or qaṛd jarra manfaʿah, which regularly arise from the structures such as that of ijarah (additional exchange contracts), and al-rahn contract. In addition, there is no conflict of muqtada al-ʿaqd between wadiʿah and rahn. This structure significantly enables the bank to generate a legitimate profit, since it does not involve qard as the underlying contract for profit generating. In fact, the profit is purely generated from a mark-up sale via tawarruq arrangement that the parties enter into.