Murabaha Calculator
Plan Islamic home or car finance. Enter the asset price, down payment, profit rate and term to see your fixed monthly instalment - and the total profit disclosed upfront, the way Murabaha should be.
Estimate. Murabaha is a fixed cost-plus sale, not interest - the total price is agreed upfront and does not compound. Banks differ in method, fees and early-settlement rebate (ibra). Confirm the structure and Shariah compliance with the institution and your scholar.
Frequently asked
What is Murabaha?
Murabaha is a Shariah-compliant cost-plus sale used for financing. Instead of lending you money at interest (riba), which is prohibited, the bank buys the asset (a car, house or goods) and sells it to you at the cost plus an agreed profit margin, which you repay in fixed instalments. The total selling price is fixed and disclosed upfront.
How is Murabaha different from a conventional loan?
A conventional loan charges interest on money lent, and that interest can compound with time or penalties. Murabaha is a sale of a real asset at a fixed, pre-agreed price - the amount you owe is set at the start and does not grow with interest. The bank must actually own the asset before selling it to you.
Reducing balance vs flat profit - which should I choose?
Reducing balance (diminishing) calculates profit on the outstanding amount, giving lower total profit - common for home finance. Flat profit applies the rate to the original amount for the whole term, giving a higher, simpler total - common for auto finance. Ask your bank which method your contract uses; this tool shows both.
Is Murabaha halal and riba-free?
Murabaha is one of the most widely accepted Islamic finance structures when done correctly: the bank must genuinely buy and own the asset, the profit must be agreed and fixed, and there must be no interest-based penalty for late payment. Structures differ between banks - confirm compliance with the institution's Shariah board.
Can I settle a Murabaha early?
Because the total price is fixed, early settlement does not "save interest" the way it does on a loan. However, many Islamic banks grant a discretionary rebate (ibra) on early settlement - it is not guaranteed and is decided by the bank. Ask about the ibra policy before you sign.
Is this financial or religious advice?
No - this is an estimate to help you compare offers. Actual instalments depend on the bank's method, fees and profit rate. Always confirm the structure and Shariah compliance with the institution and your scholar.