First lender in Malaysia to offer home financing based on Ijarah concept.
CIMB Islamic Bank recently launched ”Ijarah Property Financing-i”, an Islamic property financing based on the concept of Ijarah Muntahiyah Bittamlik. The Ijarah Muntahiyah Bittamlik concept is where banks lease the property to customers, and the customers at the end of the tenure period can take ownership of the property after the financing is completed, according to a CIMB report.
CIMB Islamic is the first bank in Malaysia to offer Ijarah Property Financing-i for those wishing to purchase a home. This financing option is currently already in use for non-residential premises.
Ijarah Property Financing-i is a unique Islamic financing package that offers customers ownership to purchase their desired property in three simple steps. Firstly, the bank purchases the property and becomes the owner of the property. Secondly, the customer leases the property from the bank at an agreed price. Thirdly, the customer purchases and owns the property at the end of the financing tenure by paying a nominal amount to the bank.
The new Ijarah Property Financing-i product is packaged to finance completed properties – be it home or business premises. The product includes the Ijarah Rental Rate Protection, which offers customers a rate protection from the fluctuations of the Base Financing Rate (BFR) with a Ceiling Profit Rate (CPR) that is capped at 10.75% per annum. There are also no additional set-up fees upon account opening.
“At CIMB Islamic, no territory will be left unchartered. We look at our customers’ needs while at the same time stay true to Shariah principles without limiting the choices. We are very proud and delighted that our valued customers would now be able to choose between our existing Bai Bithaman Ajil Property Financing-i and our new Ijarah Property Financing-i products to finance their homes and businesses,” said Badlisyah Abdul Ghani, Executive Director and Chief Executive Officer, CIMB Islamic Bank Berhad.
The Ijarah Property Financing-i could also be used for customers’ refinancing needs. This is done with the customer first selling the property to the bank and thereafter leasing the property from the bank at an agreed price. The customer would subsequently re-acquire the property at the end of the tenure by paying a nominal amount to the bank.
Ijarah Property Financing-i is now readily available at all of our 323 CIMB Islamic Bank branches which are co-located at CIMB Bank branches nationwide.
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