Deferred payment products structured so the profit is earned on a sale rather than on time, and so the late payment charge never reaches your income statement.
The problem
The commercial appeal of buy now pay later is that it looks free to the customer and profitable to the provider. Making that work within Shariah means the provider's return has to come from a genuine sale at a mark-up, or from a fee for a service actually rendered, not from the deferral itself.
The two structural questions that follow are always the same: does the provider acquire what it sells before it sells it, and what happens on late payment. Get either wrong and the product is a loan with a fee attached.
Acquisition first
Does the provider own it before it sells it
Genuine mark-up
Profit from a sale, not from the deferral
Late payment charge
Channelled to charity, kept off the income statement
Otherwise
A loan with a fee attached
What we do
Murabahah, tawarruq, wakalah or a service-fee model, assessed against how the product operates.
Whether acquisition precedes sale in the transaction flow and in the system that books it.
Structuring the charge so it is channelled to charity and configured so it can never be recognised as revenue.
The Shariah treatment of merchant discount, settlement timing and any recourse.
Customer terms, in-app presentation and the fee disclosure the customer actually sees.
Cross-border transfer where value and counter-value move at different speeds, and the sarf requirements that constrain how that is settled.
The Lifecycle
Compliance is a state you maintain rather than a certificate you obtain, and the audit cycle is how you maintain it.
We understand the acquisition flow and the fee model before we quote.
Scope, timeline and fee agreed, agreement signed.
The deep stage: the acquisition sequence, the mark-up basis, the merchant discount, and the late-payment treatment.
Findings returned and worked through with your product and merchant-integration teams; the structure is adjusted.
Issued by a certified Mufti.
Issued under a reference any counterparty can verify independently.
For a BNPL product the cycle runs for as long as it is offered: the structure is re-tested every year, and every time the merchant terms or the late-payment treatment changes.
We commit to two to four weeks for a first pronouncement. In practice it often runs longer, and in our experience the reason is the round trip rather than the review. We raise amendments, and your product and engineering teams need time to work through them. We would rather set that expectation now than surprise you in week three.
Engagements are scoped and priced individually. We have worked with BNPL platforms at launch stage and with platforms already settling live volume across several jurisdictions. One size does not fit all. Tell us what you are building and we will tell you what it takes.
Evidence
Shariah-compliant BNPL platforms (South East Asia and Central Asia)In each case we reviewed the underlying contract structure and the full product, the screening approach, the deferred-payment financing into approved purchases and the treatment of fees and late charges, and the surrounding documentation and disclosure.
Questions
A charge levied to compensate the financier for delay is generally not treated as permissible income. The common treatment is a charge channelled to charity rather than recognised as revenue, disclosed to the customer, with the accounting configured so it never enters the income statement.
Murabahah is a direct cost-plus sale of the item purchased. Tawarruq introduces a commodity sale and resale to generate cash where the underlying purchase does not fit a straightforward murabahah. Which fits depends on the merchant relationship and what is actually being financed.
Before engineering commits to a build. A Shariah issue found at design stage costs a change of structure. The same issue found after launch can cost a rebuild, a re-papering of customer contracts, and the purification of income already earned.
A pronouncement is the scholarly ruling, the reasoned opinion that a product, as described, complies. A certification is the instrument that evidences it, carrying a reference your counterparties can check. The pronouncement is the judgment; the certificate is the proof.
It can. The discount, its timing and any recourse to the provider need their own review, separate from the customer-facing financing structure.
It varies by client. Some stay with us for ongoing advisory as merchants and terms change; others come back for audit at specific points. Both are normal, and we would rather set the arrangement to what you actually need than sell a retainer you do not.
Our certification confirms Shariah compliance. It is not an assessment of whether a business is viable, whether its financials are sound, or whether the people running it can execute. Look at both questions, and do your own due diligence on the second. Every ADL certificate carries a reference you can check independently.
Book a consultation, whether you are designing a BNPL product or reviewing one already live. We will tell you at the first meeting whether the structure holds.