CONTRACTS COMBINATIONS AS A VIABLE TOOL FOR ISLAMIC COOPERATIVE TRANSACTIONS AND PROGRESSION IN NIGERIA

Abstract

The dichotomy of the legality or otherwise of contract combination seem to have been put to rest by contemporary scholars and jurists. Thus, barring the specific prohibitions in the prophetic ‘ahādith and those relating to them regarding contracts combination, it is allowed to aid innovative but Sharī‘ah-compliant product for Islamic financial institutions. Therefore, Islamic banks nowadays employ contract combination to be able to engineer viable and competitive products for customers. This paper elucidates the viability of contracts combination as a catalyst for Islamic Cooperative progression, to be able to compete on the same pedestal with counterpart cooperatives which are not Sharī‘ah-compliant. The paper employs doctrinal methodology to draw positive inferences, proffer favourable projections and present viability of contracts combination as a panacea for Islamic Cooperative innovative Sharī‘ah-compliant products. The paper reveals that contracts combination allows flexibility and customisation in innovating Sharī‘ah-compliant products which encourage risk sharing mechanism for Islamic Cooperatives. It also stimulates diversification of financial products in addition to aiding expansion of financial inclusion that enhance the nation’s economic development. This paper concludes that the prophetic prohibitions on certain combined transactions are context-specific and do not invalidate all forms of hybrid contracts under Sharī‘ah. Accordingly, properly structured contract combination remains a legally permissible and practically viable tool for strengthening Islamic cooperative innovation, competitiveness, and financial inclusion in Nigeria.