124TH SHARIAH COMMITTEE MEETING

30 SEPTEMBER 2021

REVISION ON TRADE CREDIT TAKAFUL MASTER CERTIFICATE AND ENDORSEMENT

PRESENTED BY
PRODUCT DEVELOPMENT DEPT

PREFERRED FINANCIER AND ADVISOR FOR GLOBAL BUSINESS

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 OBJECTIVE

The objective of this paper is to inform the Shariah Committee (the Committee) on the revision
made to the existing Master Trade Credit Takaful Certificate and endorsement in particularly on
Non-Claim Bonus. The same paper had been submitted to the Committee for endorsement via
Circular Resolution on 24th September 2021.

BACKGROUND
• Based on the recent Shariah rectification plan on Non-Claim Bonus (NCB) for Trade Credit
Takaful Product approved by Shariah Committee in its 123rd Meeting dated 27th August
2021 , one of the proposed plans is to incorporate a generic Non-Claim Bonus provision
under Trade Credit Takaful Master Certificate to allow the Bank/Takaful Operator to manage
the Takaful Funds as deemed fit for Takaful Business purposes.
• In addition, the revision is also made to rectify inconsistency on Term of Waiting Period
upon insolvency of Buyers as highlighted under follow up action based on the earlier
Shariah Review report on Operationalization of Shariah Requirements in EXIM Bank Credit
Takaful Acquisition Process.

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 SUMMARY OF REVISION
No Item Page Changes/ enhancements Remarks
1. Master Certificate - Para 5/ Fund To substitute para 3 to
Trade Credit Takaful Page 5 incorporate generic provision on
1. EXIM Bank:
(Export/ Domestic) Non-Claim Bonus provision
Incorporation on generic a) will manage the Risk Fund in a manner that preserve the under Trade Credit Takaful
provision on Non-Claim interest of the participants in accordance with Shariah Master Certificate to allow the
principles and will avoid investing the assets of the Risk Bank/Takaful Operator to
Bonus under Takaful
Fund (Tabarru’) in securities and assets prohibited by manage the Takaful Funds as
Fund disclosure Shariah; and
deemed fit for Takaful Business
b) shall have the discretion to conduct any action it deems fit purposes.
and necessary in managing the Risk Fund (Tabarru')
including, but not limited to, applying Non-Claim Bonus
(“NCB”) for the benefit of the participants subject to
Shariah and regulatory requirements.

Para 18/ Risk Contribution

To incorporate additional
Page 14/
iii. If there is no claim in the preceding year, the Customer provision on Non-Claim Bonus
(Export) may be eligible for a Non-Claim Bonus (“NCB”) of which under Risk Contribution clause.
the amount will be advised by EXIM Bank.
Para 14/
Page 12
(Domestic)

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 SUMMARY OF REVISION
No Item Page
2. Endorsement- Trade 1 Endorsement No: xx
Credit Takaful
(Export/ Domestic)
Draft disclosure on
generic provision on
Non-Claim Bonus for
Endorsement to be
issued to all active
Participants
MALAYSIA EXPORT-IMPORT BANK BERHAD
Changes/ enhancements Remarks
To issue a new endorsement
on additional provision under
TAKAFUL FUND
Master Certificate of Non-Claim
IT IS HEREBY AGREED THAT: Bonus to allow the Bank/
Takaful Operator to manage
Paragraph 3 of the Certificate shall be substituted by the the Takaful Funds as deemed
following: fit for Takaful Business
purposes.
3. EXIM Bank:
a) will manage the Risk Fund in a manner that preserve the
interest of the participants in accordance with Shariah
principles and will avoid investing the assets of the Risk
Fund (Tabarru’) in securities and assets prohibited by
Shariah; and
b) shall have the discretion to conduct any action it deems
fit and necessary in managing the Risk Fund (Tabarru')
including, but not limited to, applying NCB for the benefit
of the participants subject to Shariah and regulatory
requirements.
PRIVATE & CONFIDENTIAL 4
 SUMMARY OF REVISION
No Item Page Changes/ enhancements Remarks
3. Master Certificate & Para 6.i/ Ascertainment and Payment of Loss To rectify the term of waiting
Endorsement- Trade Page 8 period as per product approval.
Credit Takaful i. Where the loss is due to the Buyer’s insolvency as
(Domestic) hereinafter defined, immediately after EXIM Bank has
Rectification on Term of received confirmation that the Exporter debt has been
Waiting Period upon admitted to rank against the insolvent estate in favor of
insolvency of Buyers the Exporter;
from “60 days” to
“immediately”

The above proposed provision has been reviewed by Shariah Management Department and Legal Department for implementation.

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 RECOMMENDATION & CONCLUSION

The above revisions are presented to the Committee for information.

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 THANK YOU
Please contact us if you have any questions about the materials: Dept-ProductDevelopment@exim.com.my

The information and materials contained in this document are subject to change. Unauthorized use of EXIM Bank logo, name and copyrights are strictly prohibited. Not all products and services are available in all geographical areas. Whilst every effort has been made to ensure accuracy of
the information contained herein, EXIM Bank cannot be held responsible for any inaccuracies, delays or omissions in information provided herein given the varied nature of risks, laws, rules and regulations in which EXIM Bank ventures into.

MALAYSIA EXPORT-IMPORT BANK BERHAD PRIVATE & CONFIDENTIAL 7

 i. TCT (Export) Master
Certificate
ii. TCT (Domestic) Master
Certificate
iii. Endorsement on Takaful
Fund
Appendices
iv. Endorsement of
ascertainment of loss

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