ACKNOWLEDGEMENTWe would like to offer our humble gratitude to Allah Almighty, the most Gracious and the most

Merciful, who gave us strength and enabled us to achieve our goals.

The main purpose of the project is to know about the practical implementation of all the concepts

we studied in the Money & Banking.

Then our sincere thanks to Mr. Hafiz Muhammad Farhan, for helping us throughout the report.

His guidelines have been very useful for us in preparing this report. He helped us find new ways

of being innovative and creative.

This report would not have been possible without his cooperation and continuous direction.

Then we would like to thank our families for their incessant support and approval.

VisionEstablish Islamic banking as banking of first choice...

MissionEstablish Islamic banking as banking of first choice...

To be a premier Islamic bank, offering a one-stop

shop for innovative value-added products and service

Our Service MissionTo develop a committed service culture which ensures the consistent delivery of our products

and services within the highest quality service parameters, promoting Islamic values and ensuring recognition and a quality banking experience to our customers.

INTRODUCTION

MEEZAN was established as an Islamic Investment Bank in 1997 as “AL MEEZAN

INVESTMENT BANK LTD”. After the successful completion and great struggle First Islamic

Commercial Bank’s license was awarded to Al Meezan Investment Bank in year 2002, to start the

commercial banking facilities they bought the local operations of “Socite General” (French Bank)

03 branches and started the commercial Islamic banking in the country.

Meezan Bank stands today at a noteworthy point along the evolution of Islamic Banking in

Pakistan. The banking sector is showing a significant paradigm shift away from traditional means

of business and is catering to an increasingly astute and demanding financial consumer who is

also becoming keenly aware of Islamic Banking. Meezan Bank bears the critical responsibility of

leading the way forward in establishing a stable and dynamic Islamic Banking system replete

with dynamic and cutting-edge products and services.

BRANCHESTotal 428 branches of Meezan bank working in 117 city in Pakistan

OTHER INSTITUTIONThe bank is sponsored by leading financial institutions from Pakistan and the Middle East that include Noor Financial Investment Co., Kuwait, Pakistan Kuwait Investment Company (Pvt.) Limited and Islamic Development Bank, Jeddah. The JCR-VIS Credit Rating Company Limited,

Our ValuesCore Values

Shariah-compliance, Integrity, Professionalism, Innovation, Service Excellence, Social

Responsibility.

Staff

Committed, motivated and professionally trained employees who are empathic to their customers’needs.

Brand Personality

A sober and established, strong, empathic, professional person; who is an extremely loyal and

dependable friend and business partner, and is committed to offering comprehensive value-based

Shariah-compliant financial solutions.

Relationships

Our relationships are long-term. We recognize and value our customers’ needs above all

and strive to ensure their fulfillment. All customers are treated with professionalism and

in a friendly manner. It is our endeavour to ensure that they receive efficient and timely

service. The Meezan Bank experience is a unique one.

CAR FINANCING OF MEZAAN:-As a step towards Meezan Bank’s mission to provide a one-stop shop for innovative

value-added Shariah compliant products, Meezan Bank’s Car Ijarah unit provides car

financing based on the principles of Ijarah and is free of the element of interest.

Car Ijarah is Pakistan’s first Interest Free car financing based on the Islamic financing

mode of Ijarah (Islamic leasing). This product is ideal for individuals looking for car

financing while avoiding an interest-based transaction.

Meezan Bank’ Car Ijarah is a car rental agreement, under which the Bank purchases the

car and rents it out to the customer for a period of 1 to 5 years, agreed at the time of the

contract. Upon completion of the lease period the customer gets ownership of the car

against his initial security deposit.

Special Offer - Residual Value Ijaraah with Pak Suzuki Motors

Meezan Bank Car Ijarah Introduces Residual Value Financing enabling customer to afford

luxury with economy, where the customer can enjoy the benefits of eased rental.

Car Ijaraah also features Used Vehicles!

In addition to leasing of new cars, Meezan Bank also provides the unique opportunity of

leasing second hand, both locally assembled and imported vehicles. This feature is

specifically designed as a highly economical option. The Used Car Ijarah facility is made

available at a minimum-security deposit as low as 20%. Financing of used cars are subject

to a selection criteria.

Key Features of Car Ijarah

•Low monthly rental

•Rental paid after delivery, not in advance

•Fastest processing and delivery

•Tracker option available

•Minimum security deposit as low as 10%*

•All new, used, local, imported and luxury vehicles can be financed

Shariah Complaince:-Car Ijarah, designed under the supervision of Meezan Banks Shariah Supervisory

Board, is unique to car leasing facilities provided by other banks.

•Rights & liabilities of Owner v/s User

An Islamic Ijarah is an asset-based contract, i.e. the Lessor should have ownership of

the asset during the period of the contract. Under Islamic Shariah, all ownership related

rights and liabilities should lie with the owner while all usage-related rights and liabilities

should lie with the user. A conventional lease contract does not distinguish between the

nature of these liabilities and places all liabilities on the user of the asset, which is

contradictory to Islamic Shariah.

Under Ijarah, all ownership-related risks lie with the Bank while all usage related risks lie

with the user, thus making the Lessor the true owner of the asset and making the

income generated through the contract permissible (Halal) for the Bank.

•Continuation of lease rentals in case of total loss or theft of vehicle

If the leased vehicle is stolen or completely destroyed, the conventional leasing

company continues charging the lease rent till the settlement of the Insurance claim.

Under the Islamic system, rent is consideration for usage of the leased asset, and if the

asset has been stolen or destroyed, the concept of rental becomes void. As such, in the

above-mentioned eventualities, Meezan bank does not charge the lease rental.

•Takaful instead of Insurance

Legally (in accordance to Pakistan’s Law and Regulations), it is required for all leasing

entities to insure the leased assets. As such, Meezan Bank insures its leased assets.

•Permissibility for Penalty of Late Payment of Rent under Islamic Shariah

In most contemporary financial leases, an extra monetary amount is charged, in their

income, if the rent is not paid on time. This extra amount is the considered as Riba and

is Haram. Under Ijarah, the Lessee may be asked to undertake, that if he fails to pay

rent on its due date, he will pay certain amount to a charity, which will be administered

through the Islamic Bank. For this purpose the bank maintains a charity fund where such

amounts may be credited and disbursed for charitable purpose.

USED CAR FINANCING :-In addition to leasing of new cars, Meezan Bank also provides the unique opportunity of

leasing second hand, both locally assembled and imported vehicles. This feature is

specifically designed as a highly economical option. The Used Car Ijarah facility is made

available at a minimum-security deposit as low as 20%. Financing of used cars are

subject to the following Selection Criteria.

•The second hand car selected should not be more then twice registered.

•The vehicle should not be older than 5 years.

•The minimum security deposit for a vehicle up to 2 years of age is 20%, while minimum

security deposit for a vehicle over 2 years of age is 30%.

•At the time of maturity of Ijarah agreement, the vehicle should not be more than 8 years old.

This means that if a car is 5 years old, the Car Ijarah tenure is not more than 3 years and if its 4

years old, the tenure may be set for a maximum 4-year term.

•Second hand vehicles selected should not be worth more than Rs. 1.5 million and less than Rs.

250,000/-. Meezan Bank will have the vehicle valued by an independent valuation company

accordingly.

Eligibility Creteria

You can enjoy the benefits of Car Ijarah if you:

Are a salaried individual/ self-employed

professional/businessman

Have a net take home income exceeding

three times your monthly rental

Have two years working / professional /

business experience

Are working with your present employer

for at least six months (for salaried

individuals)

Required Documentation

If you meet the requirements and wish to apply for Car Ijarah, simply fill out an application

form and bring the following documents to your nearest Meezan Bank branch.

•Application form duly filled and signed by the applicant

•Copy of CNIC

•One recent passport sized photograph

•Any paid utility bill (Electric/Gas/Water) received at the residential address

•Original or certified copy of Recent Pay slip (for Salaried Individuals only)

•Last Six Month Bank Statement

•Specimen signature card duly signed & stamped by the bank

•Copy of Rent Agreement (if applicable

Cost of Vehicle Charges Amount (PKR)

Less than 1.00 million

(999,999/-) Processing 4,000/-

Greater than 1.00 million Processing 5,000/-

Cost of Vehicle Charges Amount (PKR)

Less than 1.00 million

(999,999/-)

Processing 3,000/-

Valuation 1,500/-

Total 4,500/-

Between 1.00 million & 1.5

million

Processing 4,000/-

Valuation 1,500/-

Total 5,500/-

Note: Valuation changes for vehicle greater than 1.5 million will be charged at actual.

Processing charges will remain unchanged.

Processing & vehicle valuation charges:-Domestic Vehicles - New

Domestic Vehicles - Used / Imported

Payment Details

Car Description: Honda City Aspire Manual

Cost Price: Rs. 1,672,000.00/-

Tenure: 5 Years

Initial Payment

Security Deposit: Rs. 334,400.00/- (20%)

Processing Fee: Rs. 4,000.00/-

Total: Rs. 338,400.00/-

Monthly Payment

60 Monthly Rentals of Rs. 38,417.00/- approx.

New Car Payment Calculator:-

Payment Details

Car Description: Mehran VXR Non-Metallic

Cost Price: Rs. 678,000.00/-

Tenure: 5 Years

Initial Payment

Security Deposit: Rs. 135,600.00/- (20%)

Processing Fee: Rs. 3,000.00/-

Total: Rs. 138,600.00/-

Monthly Payment

60 Monthly Rentals of Rs. 15,578.00/- approx.

What is Residual Value Ijarah?

The value of an asset at the conclusion of the lease term or the price at which a fixed

asset is expected to be sold at the end of its useful life is commonly referred

as Residual Value (RV).

The average car buyer should take some effort to determine the estimated value of their

new car in the future it would be best to know how much your car is worth in the future.

Based on the above definition, Meezan Bank Car Ijarah is introducing Residual Value Financing, enabling customer to afford luxury with economy, where the customer can enjoy the benefits of eased rental. A high residual value would result in a lower monthly lease

Parameters Details

Asset (vehicle)

For Residual Value Ijarah: Suzuki Mehran, Cultus,

Swift, Bolan and Wagon-R

Ownership Ownership lays with MBL

Period of facility 3, 4 & 5 years

Periodicity Pre-determined monthly rentals

Advance Rent / Security deposit

Minimum 10% of cost of the vehicle

Maximum 70% of the cost of the vehicle

Residual value (RV)

3 Year 5% to 55%

4 Year 5% to 50%

5 Year 5% to 50%

Processing charges Rs. 3,000/-

Free Accidental Death Coverage Upto Rs. 400,000/-

Mode of payment

Through post dated cheques / debit instruction

Basic Features - Suzuki

Unique Selling Points

•Pakistan’s first truly / completely

•Shariah-compliant Car Financing Scheme

•Lowest per month rent – Much lower than normal Ijarah

•Lowest processing charges

•Lowest up front payment

•First rent after one month of delivery

•Availability of Takaful

•Free accidental death coverage upto Rs. 400k

•Free Tracker (with installation & annual monitoring charges)

•Competitive Service

Premature Termination

In case the customer wishes to terminate the Agreement before the agreed period, the

customer will have an option to buy the vehicle on the agreed purchase price as

mentioned in the Terminal-value schedule forming part of the lease documents. The

purchase price takes into consideration the following amounts:

•The principal outstanding as determined by the amortization schedule of the lease.

•Residual value amount.

Maturity of RV Ijarah

At the end of the Ijarah period, Meezan Bank will make following offers to the customer:

Purchase Option: Customer will have an option to purchase the vehicle from MBL on

pre-agreed Residual Value.

Return Option: Customer will have an option to return the vehicle to MBL (MBL conduct

3rd part vehicle assessment of condition)

Parameters Details

Asset (vehicle) All variants of Indus

Ownership Ownership lays with Meezan Bank limited

Period of facility 3, 4 & 5 years

Periodicity Pre-determined monthly rentals

Advance Rent / Security deposit

Minimum 20% of cost of the vehicle

Maximum 50% of the cost of the vehicle

Processing charges Rs. 4,000/-

Takaful provisioning 4.25% with tracker

Tracker

Free Tracker (no installation & monitoring

charges) to be installed in all vehicles.

Free Accidental Death Coverage Upto Rs. 400,000/-

Mode of payment

Through post dated cheques

Basic Features - Normal Ijarah (Indus) :-

Vision

To be a premier financial services organization, operating both locally and

globally, offering a complete range of financial products and services to diverse

segments under one umbrella.

MissionTo develop & deliver the most innovative products and deliver exceptional service

quality which contribute to strengthening brand equity strength and maximize value for the stakeholders of the Bank

INTRODUCTION

Bank Alfalah Limited is a private bank in Pakistan owned by the Abu Dhabi Group. Bank

Alfalah was incorporated on June 21, 1997 as a public limited company under the Companies

Ordinance 1984. Its banking operations commenced from November 1, 1997. The bank is

engaged in commercial banking and related services as defined in the Banking companies

ordinance, 1962. Bank Alfalah is the 6th largest bank of Pakistan with 576 branches.

After a few years, the bank introduced its new identity of H.C.E.B after the privatization in 1997.

The management of the bank had implemented strategies and policies so the bank would become

a major player in the market. With a partnership with the Abu Dhabi Group the position of the

bank became stronger which allowed the bank to invest more in technology to increase its range

of products and services

Chairman of Bank Alfalah :

H.H.Sheikh Hamdan Bin Mubarak Al Nahayan

Management•Mr. Atif Bajwa – Chief Executive Officer

•Mr. Bahauddin Khan – Chief Operating Officer

•Mr. Mirza Zafar Baig – Chief Financial Officer

•Mr. Suhail Yaqoob Khan – Chief Risk Officer

•Mr. Aly Mustansir – Chief Marketing Officer

•Mr. Rizwan Ata – Group Head, Islamic Banking

•Mr. Faisal Farooq Khan – Group Head, HR & Learning

•Mr. Khurram Hussain – Group Head, Retail Central, North and Consumer Banking

•Ms. Mehreen Ahmed – Group Head, Retail Banking South & New Initiatives

•Mr. Saad Ur Rehman Khan – Group Head, Corporate & Investment Banking

•Mr. Bashir Ahmed Sheikh – Group Head, Special Assets Management

•Mr. Yasar Rashid – Group Head, Audit & Inspection

•Mr. Syed Ali Sultan – Group Head, Treasury & Financial Institutions

•Mr. A. Wahid Dada – Group Head, Operations

•Mr. Mian Ejaz Ahmed – General Manager, Legal & Company Secretary

•Mr. Anwer Umed Ali – Chief Information Officer

•Mr. Riaz Hussain Hamdani – Chief Compliance Officer

•Mr. Haroon Khalid – General Manager, Risk Management

Mr. Sajan Hamid Malik – General Manager, Credit Division

FunctionsBranch banking•Deposits, Remittances, Foreign trade, Lockers.

Consumer banking•Credit Cards,[2] Auto loans, Home loans, Consumer durables, RTCs.

Electronic Banking•Telephone banking, ATMs, Online banking

Corporate banking•Short/Long Term finance, Trade finance, Structured finance.

Treasury & InvestmentMoney market, Forex market, Investments, Government securities, Correspondent banking

Branches in PakistanThe bank is currently operating through 576 branches(as on May 1,2014) domestically

and an international presence in Afghanistan, Bangladesh and Bahrain, with the

registered office at B.A.Building, I.I.Chundrigar, Karachi. Some of the main branches are

located in all of the major cities

including: Chakwal, Hyderabad, Lahore, Kasur, Islamabad,Gawadar, Peshawar, Faisala

bad, Quetta, D.I.Khan, Rawalpindi, Sargodha, Sheikhupura, Sukkur, Sialkot, Multan, Mur

ree, Jhelum, Attock District, Gujranwala, Mirpur Khas,Lodhran, D.G.Khan, Mian

Channu, bahawalnagar, bahawalpur, Sahiwal, Khanewal and Many Other Cities all over

Pakistan.

Alfalah Car FinanceGetting your dream car was never this easy. Personalized to perfectly suit your needs, Alfalah Car

Financing offers affordable, tailor-made financing options along with special features to help you

enjoy your most preferred car in no time.

Features and Benefits•You can choose a car that is new, used or imported•Select your monthly installment plan from multiple tenure options up to 5 years•Fixed and variable rate options to cater every budget•Pay as much as you like with down payment flexibility•Enjoy special comprehensive insurance rates for complete peace of mind•No termination charges on car replacement•Apply with minimum documentation and hassle free quick processing

Documents Required•Two passport size photographs

•Copy of Computerized National ID Card

•Bank statement for the last six months

•Salary certificate (in English) specifying the name, date of joining, designation and salary details

•Signatures verified from your Banker

•Same above documents of Co-Borrower (In Case of Co-Borrower Case)

Eligibility•You are a Pakistani National Identity Card Holder

•You should be aged between 21 and 65 years of age (Loan maturity to fall in the same age bracket)

•You should have income from any of the following sources:

× Employment (Permanent/Contractual)

× Business (Partnership/Proprietorship)

× Co-Borrower’s Income (Clubbing of Income)

Fixed Rates

Financing Product 1 Year 2 Years 3 Years 4 Years 5 Years

Car Loan for

Brand New

Vehicles

17.50% 17.50% 18.00% 18.50% 18.50%

Car Loan for

Brand New

Imported

Vehicles

19.00% 19.00% 19.00% 19.00% 19.00%

Brand New

Semi

Commercial

Vehicles

(locally

manufactured

)

20.00% 20.00% 20.00% 20.00% 20.00%

Second Hand

Vehicles21.00% 21.00% 21.00% 21.00% 21.00%

Variable Rates

Financing

Product2 Years 3 Years 4 Years - 5 Years

Car Loan for

Locally

Manufactured

Brand New

Vehicles

Kibor + 3.5% Kibor + 4% Kibor + 4.5%

Car Loan for

Imported Vehicles

Kibor + 5%

Car Loan for Semi

Commercial

Vehicles (locally

manufactured)

Second Hand

Vehicles

Frequently Asked QuestionsCan I avail the car loan facility?Yes, you can if:

- You are a Pakistani National Identity Card Holder

- You should be aged between 21 years of age and maximum 60 years (in case of Salaried)

and 65 Years (In case of Self Employed/Business) at time of maturity of Loan.

- You should have income from any of the following sources:

× Employment (Permanent/Contractual)

× Business (Partnership/Proprietorship)

Which Car Types are offered for financing?Following Categories are being offered in BAL Car Financing

•Brand New Locally Manufactured Vehicles

•Semi-commercial vehicles for personal use

•Used Vehicles (Registered)

•Imported Vehicles

How much loan facility can i avail?Minimum of Rs. 200,000/- and maximum of Rs. 4,000,000/- for brand new local and imported vehicle. For Used

Vehicles minimum of Rs. 100,000/- and maximum financing limit is 2,000,000/-.

What is the period of the loan?The loan can be availed from 1 year to 5 years with early adjustment facility at any time before the maturity (varies

with the type of vehicle and the age of the customer)

How much initial down payment do I have to make?For Brand New Locally Manufactured Vehicles – 20 % of the value of the Car. For Imported/ used Vehicles – 25%

of the value of the Car (As assessed by Approved Evaluator of Bank)

What other charges do I have to pay?You have to pay a processing fee of Rs. 4,500/- (exclusive of FED), registration charges and first year’s insurance

premium.

What is the security of the loan?The car is the security, which will be hypothecated in favor of the bank and lien will be marked with

the respective Excise & Taxation Department.

What if I want the car in the name of my family members?You can avail the facility with joint registration title with

•Spouse

•Siblings (real brother/real sister)

•Son/Daughter

•Father/Mother

•Father In-law / Mother In-Law

What documents are required to get a car loan sanctioned?Our representative will discuss in detail the documents you are required to

submit. An indicative list is given below:

For Salaried Individuals

•Two passport size photographs

•Copy of Computerized National ID Card

•Bank statement for the last six months

•Required “For Salaried Individuals, Salary certificate specifying the name , date of joining,

designation, salary details and signatures verified from your Banker.”•Same above documents of Co-Borrower (In Case of Co-Borrower Case)

How is it different from other financing schemes available in

Pakistan?

•Quickest processing & turnaround time in the market

•Minimum documentation requirements

•Variable & fixed rates to cater to every budget

•No termination charges on car replacement

•Discounted Insurance rate with free tracking device

What is the first step I need to take?You can call 111-225-111 to talk to our Phone Banking Officer or stopover at your nearest branch from our network of over 400 nationwide branches in Pakistan

Approval method:

Approval method for the car financing is very simple. Customer should visit the bank and

provide the required documents and then his request will be

entertained by the branch manager and after verification of documents the request will be

forwarded to the regional head who will make final decision.