ISLAMIC PAWNBROKING PDF

Ar Rahnu, also known as Ar Rahn, is Islamic pawnbroking for short-term collateralized borrowing. Ar Rahnu introduced in Malaysia was a relatively new micro credit instrument. Only gold and jewelry made of gold can be pawned. It is available to both locals and foreigners, Muslims and Non-Muslims alike, Loan tenures range from months. Borrowers have a choice either to repay either via lump sum or by monthly installments. In the event the borrower cannot repay the loan, it is possible to be granted extensions of up to 2 months.

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If the borrowers are still unable to repay the loan, the pawned item will be auctioned off and any surplus less outstanding amount and charges would be returned to the borrower. Islamic Pawnbroking Ar-Rahnu It implies that this instrument will help the community to increase economic capability of their families. Ar-Rahnu; Islamic pawn broking; Micro credit instrument. Why would anyone go for Ar Rahnu? However, if the price of gold has increased during the auction, the excess balance after deducting the principal and safekeeping will be refunded to you.

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