Glossary
Wa'd
A promise made by one side, which may or may not be legally binding.
وعدwa'd
Wa'd is a unilateral promise, as distinct from a contract, which needs two sides. It is the joint of modern Islamic structures: a customer promises to buy the asset, or a bank promises to sell it, and the actual contract follows. AAOIFI covers it in Shariah Standard No. 49 on unilateral and bilateral promise, and its tawarruq standard permits a binding promise only from one party. The reason the number of parties matters is that two mutual binding promises start to look like the contract itself, which is how a promise can smuggle in an inah.
Related terms
Bai' al-InahSelling something to someone on credit and buying it straight back for less cash, so they get money now and owe more later.TawarruqBuying something on credit and selling it on for cash, so you end up with money now and a bigger bill later without paying interest.MurabahahA sale where the seller tells you what the goods cost and what profit is being added, and you pay later.
Sources
- AAOIFI Shariah Standard No. (49); Shariah Standard No. (30) clause 4/1