Types of Modaraba

Modarabas can be classified in two different types:

* Multipurpose Modaraba
* Specific purpose Modaraba


1. Multipurpose Modaraba: Such a Modaraba has more that one objectives or purposes. For instance a Modaraba may be floated for funding a clinic, running a transport service and operating a departmental store simultaneously.
2. Specific purpose Modaraba: It has a specific or a single objective / purpose. Modaraba floated for a textile mill is an example of such a Modaraba.

Authorization of Modaraba:
The Registrar after obtaining approval from the Religious Board that the business of Modaraba is in conformity with Islamic Principles and after being satisfied that it is in the public interest to grant approval to Modaraba, will grant a certificate authorizing the floating of Modaraba. The registrar may impose any condition which he may deem fit.