The Lotus Ijarah is an Islamic lease such that the customer (lessee) pays for the usufruct of an asset owned by the Lessor at a predetermined price spread across an agreed repayment period. At the completion of payment, there is an option of sale of the asset to the customer on previously agreed terms.

Islam has a set of strict rules that forbid making or receiving interest payments, and this is one way to get the benefits of leasing without charging interest.

Features of Ijarah

  • Rentals have to be known prior to each period.
  • Owner of asset can make all transactions on leased asset.
  • Owner of usufruct can make all transactions on usufruct.
  • It can be contracted for existing assets.
  • Proceeds of sale of usufruct can be used to finance construction of the leased asset.


  • Can be used to acquire assets such as cars, office equipments, manufacturing equipments, household appliances etc
  • Customer pays for usage of asset.
  • Buy back is N100.
  • Income is not charged on insurance
  • No interest is charged on due obligation
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