Ijara is a financial leasing agreement in Islamic finance, where one party leases an asset to another for a specific period in exchange for rental payments. This arrangement allows the lessee to utilize the asset without acquiring ownership, which aligns with the principles of risk-sharing and asset-backed financing that are central to Islamic finance. Ijara can be seen as a mechanism that supports economic activity while adhering to the prohibition of interest (riba) in Islamic law.
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