Personal financing or personal loan is a popular choice of many when it comes to solving financial problems because of its flexibility as it does not require any collateral. Unlike car loans or home loans, both of these loan facilities require collateral when you apply for a loan. Plus, if you do not repay your car loan or home loan, the bank has the right to take back your assets (collateral).
So, many people really enjoy the flexibility of personal financing where you can use it for any purpose like emergency matters, wedding, debt consolidation, buying a motorbike, starting up a business, and others. However, some people are also confused by the difference between Islamic personal financing and conventional personal loans, especially when it comes to these Islamic terms or jargon in a financing application or contract.
In this infographic, we will compare the main differences between Islamic personal financing and conventional personal loan in terms of contract type, profit rate, late payment, and so on. Hopefully, this infographic can help you to better understand the differences between these two types of financing.
This infographic is prepared by Direct Lending. We are a personal lending platform that provides safe, reliable, and Shariah-compliant bank and koperasi financing. If you need funding to solve your financial problems, you can check your eligibility on our platform for 100% free, no upfront payment or processing fees will be charged.
To learn more about Islamic banking, read this article where we explain the concepts of Bai Inah and Tawarruq that are applied in most Islamic personal financing. This article also shares about Shariah terms that are often used in applications or contracts. Some examples are akad, ibra, wakalah fee, and others. We hope that with the information shared, you will have a better understanding and know which Islamic financing or conventional loan is more suitable for you.
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