Wakalah means "agency" or "delegation". It is a contract where you appoint someone (the agent or wakeel) to perform a specific task on your behalf — buying property, investing money, managing a portfolio, or conducting a business transaction.
In Islamic banking, Wakalah is the backbone of many products. When you deposit money in a Wakalah-based investment account, the bank acts as your agent, investing your funds in Shariah compliant ventures. The bank charges a fixed agency fee and passes the profits (or losses) to you.
The beauty of Wakalah is its transparency. The agent's fee is agreed upfront, and the principal knows exactly how their money is being managed. It is used extensively in Takaful (Islamic insurance) and Islamic fund management.