Bay al-Muajjal

Bay al-Muajjal (also written Bay' al-Mu'ajjal) is an Islamic sale contract in which the delivery of goods is immediate but payment is deferred to a future date or paid in instalments. The term derives from the Arabic 'ajala' (to delay), meaning 'sale with delayed payment.' Bay al-Muajjal is the counterpart to Salam (Bay al-Salaf) — where payment is immediate and delivery deferred — making it a 'normal credit sale' in Shariah terminology. The permissibility of Bay al-Muajjal is established by Hadith and the unanimous consensus (Ijma) of the four main Sunni legal schools (Hanafi, Maliki, Shafi'i, and Hanbali). Crucially, the higher deferred price compared to a cash price is permissible in Islam: the difference reflects commercial considerations of time, not a Riba (interest) charge, provided the price is fixed at inception and cannot escalate further for late payment. Bay al-Muajjal is the foundational contract underpinning most Islamic retail financing: Murabaha with deferred payment (cost plus mark-up on credit), Bay Bithaman Ajil (credit sale with instalments), and many Istisna arrangements all incorporate Bay al-Muajjal elements. AAOIFI Shariah Standard No. 8 and related standards provide the contemporary framework. The IOF CORE_ISLAMIC_CONTRACTS rail uses Bay al-Muajjal as the payment-deferral mechanism within Murabaha, BBA, and trade finance products.