Islamic and conventional leasing

what is the difference between Islamic and conventional leasing?

There are some differences between islamic and conventional leasing.

  1. In islamic leasing, the bank bears the risk of loss if it’s not because of the lessee’s fault. While in conventional leasing, the bank doesn’t responsible for any losses.
  2. Penalty on late payment is charged in conventional leasing, while it’s not charged in islamic leasing.
  3. No party can terminate the contract without mutual consent unless one party broke the agreement.