Banking

Musharaka — Bank's Capital Contribution

An Islamic bank contributes capital to a joint venture with a customer under Musharaka.

Account NameTypeDebit ($)Credit ($)
Musharaka Investment (Partnership)Asset (+)1,000,000.00-
Cash / Funding AccountAsset (-)-1,000,000.00

💡 Accountant's Note

In a Musharaka, the bank and customer are co-owners sharing profits and losses. The bank's contribution is an equity investment, not a loan. Profit-sharing ratios are agreed upfront; loss-sharing follows the capital ratio strictly.

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