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Chapter 3 :Individual assignment 3 : Case Study 1 CASE STUDY QUESTIONS: 1-Outline the key differences between conventional leasing and Islamic leasingOwnership: Ijara: “Muajjir” (lessor) is the owner of the leased property.Conventional Lease:The creditor institution (banks, leasing companies, etc.) retains the ownership of the asset throughoutthe term of the contracts.Risk bearer: Ijara: As Ijara is an asset based contract, and lessor or mu`jir has the ownership of the asset, thereforeall the ownership related rights and liabilities lie with the mu`jir and mustajir is responsible for all the usage related rights and liabilities. Any loss or harm caused by factors beyond the control of the ³Mustajir´ lessee shall be borne by the Muajjir´.Conventional lease: The lessor assumes and manages the risk of the asset.Penalty of Late Payment of rent:Ijara: The bank or financial institution is not allowed to charge the customer an additional amount in case of delays in payment of the rentals since it is considered Riba. Islamic scholars have found a solution customer could be asked to pay a certain amount to charity.Conventional lease: The bank charges a certain amount as a penalty for late paymentContinuation of lease rentals in case of total loss or theft of asset:Ijara: If the leased asset is lost or stolen the Islamic bank does not charge the lease rental because in the Islamic system, rent is consideration for usage of the leased asset, and if the asset has been stolenor destroyed, the concept of rental becomes void