---
title: "What is Wa'd (promise)? | IslamicOpenFinance™"
description: "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."
url: https://islamicopenfinance.com/glossary/wad/
lang: en-GB
source: "IslamicOpenFinance"
---

[Glossary](https://islamicopenfinance.com/glossary/) / [Treasury, liquidity and hedging](https://islamicopenfinance.com/glossary/#treasury)

Treasury, liquidity and hedging

# 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.

Wa'd is a unilateral promise, an expression of commitment by one party to perform certain actions in the future, as Bank Negara Malaysia's glossary defines it. Many standard setters accept that a wa'd can be binding on the promisor, which allows it to support purchase undertakings in sukuk, lease-to-own arrangements and Islamic hedging. A bilateral exchange of binding promises for the same deal, muwaadah, is treated more restrictively.

## Sources

- [Bank Negara Malaysia, Shariah Contract Framework discussion paper, 2024: Glossary, Wa\`d](https://www.bnm.gov.my/documents/20124/938039/dp-shariah-contract-nov24.pdf)

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

[**Muwaadah (mutual promise)** An exchange of promises between two parties for the same future transaction, treated more restrictively than a unilateral wa'd.](https://islamicopenfinance.com/glossary/muwaadah/) [**Purchase undertaking** A unilateral promise by the originator or obligor to buy the sukuk assets from the holders at maturity or on default.](https://islamicopenfinance.com/glossary/purchase-undertaking/) [**Islamic FX forward** A currency hedge built on a binding promise to exchange at an agreed rate on a future date, with the exchange itself done at spot.](https://islamicopenfinance.com/glossary/islamic-fx-forward/) [**Tahawwut (hedging)** Hedging; in Islamic finance, risk management transactions built from permissible contracts rather than conventional derivatives.](https://islamicopenfinance.com/glossary/tahawwut/)

**Treasury, liquidity and hedging**

1. [Commodity murabaha](https://islamicopenfinance.com/glossary/commodity-murabaha/)
2. [Muwaadah (mutual promise)](https://islamicopenfinance.com/glossary/muwaadah/)
3. [Tahawwut (hedging)](https://islamicopenfinance.com/glossary/tahawwut/)
4. [Islamic profit rate swap](https://islamicopenfinance.com/glossary/profit-rate-swap/)
5. [Islamic FX forward](https://islamicopenfinance.com/glossary/islamic-fx-forward/)
6. [Islamic cross-currency swap](https://islamicopenfinance.com/glossary/islamic-cross-currency-swap/)
7. [Interbank investment wakalah](https://islamicopenfinance.com/glossary/interbank-investment-wakalah/)
8. [Collateralised murabahah](https://islamicopenfinance.com/glossary/collateralised-murabahah/)

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