Ijarah wa-iqtina

Definition of "Ijarah wa-iqtina "

Lease-and-purchase transaction; a financing instrument used by practitioners of contemporary Islamic finance in which a financier purchases reusable merchandise (e.g. airplane, buildings, cars) and then leases them to clients in return for an agreed upon rental fee (to be paid for the length of the lease period) and an agreement that the client will purchase the merchandise at the end of the lease period.. There are similar transactions of various names, among them al-ijarah al-muntaha bi-tamlik.