Suggested product for Islamic factoring

Abstract

This study aims to illustrate a proposed product for Islamic factoring. This product aims to provide the necessary liquidity for commercial companies in order to practice their investment business. The structure of this product is based on good loans, which Islamic Sharia has mandated to activate, because of its great benefits, especially in the various investment fields. It is also based on activating the agency with a fee to achieve a return for the financial companies that implement the idea of ​​Islamic factoring or managing the project for a fee agreed upon between the commercial companies and financial companies. The Islamic factoring proposal has legitimate origins, among which are the bills, the common benefits, and the general rules in Islamic jurisprudence. Islamic financial engineering is the cornerstone of designing such products, which is based on the idea of integrating Islamic financing instruments, with named or modern contracts, to activate the proposed product.