Time to consider tawarruq home financing – a new insight

TAWARRUQ home financing is a growing segment of Islamic home financing for many banks in Malaysia. For instance, an annual report by Bank Islam Malaysia Berhad (BIMB) indicates that its tawarruq home financing well-performed - on 31st December 2014, the bank managed to reap a financing value of RM3.9 billion and increased to RM9.5 billion on 31st December 2016 (Bank Islam, 2014; 2016). An increase of 143.59 percent. It is reported that tawarruq home financing was a vital segment that contributed to the bank’s profit and increased its customer base. Though it is now a growing segment of Islamic home financing, there exists a fallacy among laymen who still believe that tawarruq home financing is another dimension of BBA that carries a different terminology but bring...