---
title: "What is Purchase undertaking? | IslamicOpenFinance™"
description: "A unilateral promise by the originator or obligor to buy the sukuk assets from the holders at maturity or on default."
url: https://islamicopenfinance.com/glossary/purchase-undertaking/
lang: en-GB
source: "IslamicOpenFinance"
---

[Glossary](https://islamicopenfinance.com/glossary/) / [Sukuk and capital markets](https://islamicopenfinance.com/glossary/#sukuk)

Sukuk and capital markets

# Purchase undertaking

A unilateral promise by the originator or obligor to buy the sukuk assets from the holders at maturity or on default.

A purchase undertaking is a unilateral promise, a wa'd, by the originator or obligor to buy the underlying assets from the sukuk trustee on a set date or on an event such as default. It is the main exit mechanism in many sukuk and determines how holders are repaid. IIFM includes a purchase undertaking among its standard sukuk al-ijarah templates, and the agreed exercise price is closely reviewed, particularly in partnership-based sukuk.

## Sources

- [IIFM, Published Standards: Sukuk Al Ijarah template, Purchase Undertaking](https://www.iifm.net/standards/published-standards)

This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.

## Related terms

[**Wa'd (promise)** A unilateral promise to do something in the future; it can be made binding and is used in hedging, sukuk and lease-to-own deals.](https://islamicopenfinance.com/glossary/wad/) [**Sukuk al-ijarah** Sukuk whose holders own leased assets and receive the rent paid by the lessee as their return.](https://islamicopenfinance.com/glossary/sukuk-al-ijarah/) [**Sukuk al-musharakah** Sukuk whose holders are partners in a venture, sharing profit by agreed ratios and loss in proportion to capital.](https://islamicopenfinance.com/glossary/sukuk-al-musharakah/) [**Asset-backed and asset-based sukuk** The distinction between sukuk whose holders have real recourse to the assets and those relying mainly on the obligor's promise to pay.](https://islamicopenfinance.com/glossary/asset-backed-sukuk/)

**Sukuk and capital markets**

1. [Sukuk](https://islamicopenfinance.com/glossary/sukuk/)
2. [Sukuk al-ijarah](https://islamicopenfinance.com/glossary/sukuk-al-ijarah/)
3. [Sukuk al-musharakah](https://islamicopenfinance.com/glossary/sukuk-al-musharakah/)
4. [Sukuk al-mudarabah](https://islamicopenfinance.com/glossary/sukuk-al-mudarabah/)
5. [Sukuk al-wakalah](https://islamicopenfinance.com/glossary/sukuk-al-wakalah/)
6. [Periodic distribution](https://islamicopenfinance.com/glossary/periodic-distribution/)
7. [Islamic collective investment scheme](https://islamicopenfinance.com/glossary/islamic-collective-investment-scheme/)
8. [Shariah screening](https://islamicopenfinance.com/glossary/shariah-screening/)

[All 221 terms](https://islamicopenfinance.com/glossary/)