Deferred Sale (Bai’ Mu’ajjal/Bai’ Bi Thaman Ajil (Bba)): Its Origin and Validity from a Maqāṣid Sharīʿah Perspective

Abstract

Deferred sale (Bai’ mu’ajjal), in the Islamic Banking and Finance
world widely known as Bai’ bi thaman ajil (BBA), is used as an extension to
Profit-sale (Bai’ murabahah); both sales complement each other. The Profitsale
sells the commodity with profit over the cost price, and BBA plays the role
of receiving that payment on deferred or instalment basis. BBA has become
the “premier consumer financing facility” for the Islamic financial institutions
(IFIs). This paper deals with deferred sale precisely. It looks into its origin and
its transition from void to valid sale. Its application as trade contract and its
modern application as financing tool is analysed in the light of the maqāṣid
Sharīʿah.