Qirad market

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Dictionary term

Definition of "Qirad market"

Market for qirad funds. In Islamic economy, funds for qirad may be available through banks, insurance companies, joint stock companies, mutual funds, investment trusts and other financial intermediaries. The supply of and demand for qirad funds determines the ratio for distributing uncertain outcomes of the enterprise. This ratio has been variously termed in the literature as qirad rate, profit-share, mudarabah rate, etc. The qirad market automatically adjusts this rate but the central bank may also intervene and prescribe qirad rates for different sectors.


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