Mudarabah Mutlaqah

Mudarabah Mutlaqah (Unrestricted Mudarabah) is a profit-sharing investment contract in which the capital provider (Rab al-Maal) grants the investment manager (Mudarib) complete discretion to invest the funds in any Shariah-permissible activity without geographic, sectoral, or asset-class restrictions. The Mudarib may invest across industries, asset classes, and geographies as their business judgment dictates, subject only to Shariah screening (no Haram sectors, no Riba-based instruments). AAOIFI Shariah Standard No. 13 governs Mudarabah Mutlaqah, permitting the Mudarib to mix the investor's capital with other funds, commingle investments across multiple investors, and pursue diverse investment strategies. In Islamic banking, Mudarabah Mutlaqah underpins Unrestricted Investment Accounts (URIA) — a product where depositors invest on unrestricted terms, accepting that the bank (as Mudarib) will deploy funds across its general asset portfolio. UIRAs form a significant portion of Islamic bank liabilities. IFSB-1 provides capital adequacy treatment for URIA, including the Profit Equalisation Reserve (PER) and Investment Risk Reserve (IRR) mechanisms that smooth distributions. Profits are shared between Rab al-Maal and Mudarib according to a pre-agreed ratio; losses (other than those caused by Mudarib negligence or misconduct) are borne entirely by the capital provider. The IOF CORE_ISLAMIC_CONTRACTS and ISLAMIC_FUNDS rails support Mudarabah Mutlaqah with full PER/IRR management, profit distribution, and IFSB-1 reporting.