Parties to Modaraba

The following are the parties to the modaraba:

1. The Investor (Modarib) : one who invest his money in the modaraba business.


2. The Company : It is the modaraba company which offers labor to multiply the investment.


3. The Bank : It acts as a trustee between the investor and the modaraba company. It should be borne in the mond that the relations between the investor and the modaraba company is in no case similar to that of the lender and the borrower. In case of lending, interest and the principal amount must be returned irrespective of profit or loss.