Ijarah (Commercial Lease)

A form of asset finance which has the benefit of using assets without the requirements of ownership. NBK KSA lets the lessee acquire the asset he/she needs without borrowing on interest and receives the benefits of use while the lessor receives the value of regular rental payments for a specified period plus the residual value of the asset. The lease may be written either for a short-term or for a long-term and its rules are similar to those governing sale because in both cases there is a transfer of one thing between two parties for valuable consideration.