Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh.  (May Allah's Peace, Mercy and Blessings be upon all of you)

One of our brothers/sisters has asked this question:

what is the consept of Musharaka and Mudarabah in islam?

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Answer:

Concept of Musharaka and Mudarabah in islam

In the name of Allah, We praise Him, seek His help and ask for His  forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is no one (no idol, no person, no grave, no prophet, no imam, no dai, nobody!) worthy of worship but Allah Alone, and we bear witness that Muhammad(saws) is His slave-servant and the seal of His Messengers.

Musharaka is a transaction or a business where two or more people get together and jointly invest their wealth into something, whereby they share the profits and losses with each other.

Mudaraba is a transaction or a business where a number of people (one or more) invest their wealth into something, and some other people (one or more) put in their efforts without any investment of their own …. And then all these people share the profits and losses as agreed between them.

Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me. Allah Alone Knows Best and He is the Only Source of Strength.

Your Brother in Islam,

Burhan