Definition of Gharar and the 3 Degrees of Uncertainty

Gharar is among the prohibited elements in commercial transactions. Nevertheless, unlike riba’, its prohibition is not absolute because some degree is tolerable. One must avoid only excessive uncertainty.

Definition of Gharar

Gharar literally means risk. Technically, it is something for which the probability of getting it and not getting it are about the same, “something whose acquisition is uncertain and its true nature and quantity is unknown.” (Mu’jam ISRA, 2010: 131)

Understanding of Gharar

We can summarize the cause of prohibition as follows:

1. Uncertainty of existence and future outcome of the transaction. For example, you want to buy birds in the sky from this seller A. The existence of the bird is uncertain in the future. So, it is excessive uncertainty.

2. Uncertainty in possession of ownership. For instance, the sale of goods whereby there is no ownership or incomplete ownership.

3. Inadequacy and inaccuracy of information such as in type shape, quantity and weight.

4. Pure games of chance such as gambling

Degrees of Uncertainties

1. Gharar Yasir (Light Uncertainty): The uncertainty is slim, hence might be easily tolerated by both parties. For instance, a forward lease has some element of uncertainties regarding the future existence of its usufruct.

2. Gharar Mutawasit (Intermediate Uncertainty): Muslim jurists may hold different perspectives based on ijtihad by either associating it to slight uncertainty or excessive uncertainty.

3. Gharar Fahish (Excessive Uncertainty): It is uncertainty that affects the core element of the subject matter such as selling bird in the sky.

To read more about Islamic Finance related topics, please click here and visit our academy.

Feel free to sign up for our free stock screening services at

2 thoughts on “Definition of Gharar and the 3 Degrees of Uncertainty”

  1. Pingback: Islamic Finance For Business: Finance That Powers Business Growth - AmanaTrade Academy

  2. Pingback: Halal Investment in Australia: The Best Opportunities for You - AmanaTrade Academy

Comments are closed.