The Impact of Murabaha Financing through Purchase Orders on the Growth of Working Capital

Abstract

This research addresses the impact of Murabaha financing for purchase orders on working capital growth, as one of the most important Islamic financing methods used in Islamic banks and financial institutions. The study aims to identify the extent to which this financing method contributes to supporting institutions' economic activities and improving their ability to provide necessary liquidity to cover short-term operational needs. The topic's importance stems from the growing role played by Islamic banks in financing economic activities, particularly given the need for financing alternatives that comply with Islamic Sharia rulings while achieving economic efficiency simultaneously.

The research focuses on analyzing the concept of Murabaha financing for purchase orders and its characteristics, explaining its application mechanism in Islamic financial institutions, in addition to clarifying the concept of working capital and its importance in achieving financial stability for institutions. It also seeks to study the relationship between the use of Murabaha financing and working capital growth, and its impact on enhancing financial liquidity and improving the efficiency of financial resource management within the institution.

The research adopted the descriptive-analytical approach through reviewing literature and previous studies related to Islamic finance and the Murabaha method, and analyzing available data and information on the role of this type of financing in supporting institutions' operational activities. It also addressed some applied models illustrating how Murabaha financing is used to finance various institutional needs.

The research concluded that Murabaha financing for purchase orders is one of the effective financing tools that contributes to supporting working capital and improving institutions' financial capacity, as it helps provide necessary liquidity to meet short-term obligations, positively reflecting on economic activity stability and enhancing growth and expansion opportunities.