bluuebunny/crossref_metadata_2025 huggingface dataset:
Islamic Social Finance and Sustainable Development Goals: Issues and Challenges
Authors: Rosman Romzie , Redzuan Nur Harena , Mokhtar Nor Zainiyah Norita , Engku Ali Engku Rabiah Adawiah , Mohammed Mustafa Omar
Published: February 2025

Islamic finance is an important driver to support the implementation of sustainable development goals. Theoretically, the core principle of Islamic finance aligns with the sustainable development goals. Moreover, the application of Islamic social finance instruments especially zakat, waqf, and sadaqah can be managed efficiently and effectively to support the specific sustainable development goals. However, there are many issues and challenges in the understanding and application of Islamic social finance, and some perceptions of the sustainable development goals agenda from the Islamic perspective. This study firstly discussed the concept of Islamic social finance and discusses each Islamic social finance instrument. Then, a qualitative research method based on Focus Group Discussion was employed to investigate the issues and challenges of Islamic social finance to support the sustainable development goals. The findings include an investigation and discussion on the important themes which are on: (1) the definition of Islamic social finance; (2) the relation of Maqasid Shariah and sustainable development goals in Islamic social finance; (3) The application of Islamic social finance in eliminating poverty; and (4) the issues and concern in the utilization of Islamic social finance to improve socio-economic well-being. The study suggests a more focused definition of Islamic social finance as a subset of Islamic finance; and the findings may enhance the policy implication, especially on the application of Islamic social finance instruments due to their unique characteristics as compared to the widely use Islamic financial instruments.
Factors Influencing Behavioral Intention to Participate in Family Takaful in Malaysia: An Extension of UTAUT2 Theory
Authors: Zainordin Nur Aqilah , Engku Ali Engku Rabiah Adawiah , Haron Razali
Published: February 2025

This paper aims to investigate the critical success factors that affect behavioural intention to participate in family takaful in Malaysia using the extended Unified Theory of Acceptance and the Use of Technology Model (UTAUT2) among Muslim Malaysians. This study examines the direct relationship between performance expectancy, effort expectancy, social influence, facilitating conditions, hedonic motivation, price value, and habit towards behavioural intention to participate in family takaful in Malaysia. Moreover, the study explores the indirect relationship between behavioural intention and trust. This research uses quantitative methods. The data were collected from 389 respondents using a convenient sampling technique. The relationship among the variables is assessed using partial least squares structural equation modelling (PLS-SEM) for hypothesis testing. The findings showed that performance expectancy, effort expectancy, facilitating conditions, hedonic motivation, price value are strong predictors of behavioural intention to participate in family takaful in Malaysia. Moreover, trust mediated the relationship between behavioural intention and participation in family takaful. However, social influence and habit insignificantly influence the behavioural intention to participate in family takaful in Malaysia. This study provides an extended UTAUT2 model that has never been tested in the context of family takaful. The study contributes to the field of consumer behaviour and marketing of Islamic financial products.
Quranic Perspective on Commercial Transaction (Trade) and Riba: Thousand Years of Banking Theories and Practices
Authors: Ingratubun Muhammad A , Siregar Hermanto , Sri Mulatsih  , Furqon Syarief Hidayatulloh
Published: February 2025

Al Quran describes the prohibition of Riba rā bā wāw ( ر ب و ) (often translated as usury) and permission of commercial transaction or trade (bā yā ʿayn ب ي ع ). We conducted a desk-study reviewing and analysing the historical connection between these two and their current implications through empirically proven and attested central bankers' modern banking theories and practices. We anchored our study on the etymological and ontological approaches. We specifically applied the spectrum of Al Quran (AQ) Chapter Al-Baqarah (2), verse 275 (AQ, 2:275) as the benchmarks. We discovered the root of the propagation of legalized riba through banks operating licenses issued by the government (temple biyaʿ ( بِیَع ) as a derivative of trade (bā yā ʿayn ب ي ع )). This makes the current permissible legal, commercial transaction or trade no longer isolated from prohibited riba. We argue that under the current banking practices and infrastructure, no transaction is riba-free, including those under Islamic banking and finance. Mitigating this requires immunized national banking practices that are detached from international banking systems and infrastructure.
The Role of Artificial Intelligence Technologies in Expediting Financial Inclusion: The Case of Selected African Countries
Authors: Vatimetou Mokhtar Maouloud  , Auwal Adam Sa’ad  , Salina Kassim  , Anwar Hasan Abdullah Othman
Published: February 2025

revolution 4.0 technology. AI has played a crucial role in accelerating the financial inclusion rate by easing the use of financial products. From the African perspective, there is a very few notable uses of AI technologies in the banking and finance industry, but such uses are not advanced in nature. Therefore, this paper attempts to study the role of AI for financial inclusion in some selected African countries. This paper is a conceptual study that uses a systematic literature review of 11 recent published papers about the relationship between AI and financial inclusion in the context of Africa. This study uses various and most recent published papers obtained from different online databases (mainly Scopus, Emerald, Elsevier, Tailor & Francis, Springer, EBSCO, and JSTOR) to investigate the conceptual and empirical role of AI on financial inclusion and poverty in some selected African countries. The study reveals that mobile money and crowdfunding are the most common fintech tools used in Africa. Therefore, some recommendations are provided for governments and policymakers to instigate techniques that will enhance digital financial inclusion, including using Artificial Intelligence for poverty alleviation in Africa.
An Analysis of the Joint Liability Model in Bangladesh: Lessons for the Islamic Microfinance Institutions
Authors: Niaz Makhdum Muhammad  , Salina Kassim  , Nur Farhah Mahadi  , Engku Rabiah Adawiah Engku Ali
Published: February 2025

As a powerful tool for eradicating poverty, microfinance enables the underprivileged to rise up the social and economic ladders, contribute to society, and lessen their vulnerability. As a novel financial tool, Islamic microfinance can also help the impoverished escape the cycle of poverty. Bangladesh has millions of people who are living in abject poverty because of their inability to use formal financial services. Hence, to improve the conditions of the poor, a good number of microfinance institutions have come forward with a variety of microfinance products. Most significantly, different microfinance institutions like the Grameen Bank and the Islamic Bank Bangladesh Limited (IBBL) have started their microfinance programmes that have achieved immense success in Bangladesh. This study aims to analyse the lessons the Islamic microfinance institutions (IMFIs) can take from the success of the Grameen Bank and its joint liability model. Using the systematic literature review (SLR) approach, this study does a comparative analysis between the operations and success of the joint liability model of Grameen Bank and the Rural Development Scheme (RDS) of IBBL. It also offers some useful recommendations for the IMFIs generally so that they can enhance their impact on the poor and vulnerable people through Islamic microfinance schemes. The outcomes of this study can be vital for practitioners and entrepreneurs who want to start the operations of new IMFIs, specifically in Bangladesh.
Crypto-Asset. How Does Shariah Matter?
Authors: Mohd Ma’Sum Billah
Published: February 2025

In the post-COVID era, it has further been observed that, fintech is extra-ordinarily among the fastest growing chapters in the eco-financial sectors and crypto-currency is not an exception. There are mixed views within the ambit of Shariah on the existing floating models of crypto-currencies bearing a common confusion on one’s intrinsic value and thus, whether they are compliant with Shariah? If not, what, and how the Shariah alternative solution may be in meeting the global Halal sentiment? The idea of crypto-asset is a new dimension with hypothetical discovery, which is quite different in nature as to crypto-currency (CC). The existing model of crypto-currency does not require an underlying asset to back the operation, while a crypto-asset in contrast, requires an underlying valued asset to back the operation and thus, positioning one bearing own intrinsic value. This paper, however, seeks to analyse the model structure, operational mechanisms, and possible Shariah review of crypto-asset (CA) within the principle of Maqasid al-Shariah. The research is expected to adapt hypothetical and META approaches by concluding with possible Shariah compliant strategic solution to crypto-asset in harmonizing with the contemporary eco-appreciation. The result of this research may be an added value to the current post-COVID eco-paradigm in creating an eco-opportunity for every level of people within the spirit of Maqasid al-Shariah.
Assessing Satisfaction of Islamic Economics and Finance Curriculum: An Application in International Islamic University Malaysia
Authors: Yavuz TURKAN  , Dzuljastri Abdul Razak  , Mustafa Omar Muhamad  , Ugur COBAN
Published: February 2025

This study investigates the satisfaction levels of students and lecturers regarding the Islamic economics and finance curriculum at IIUM. In the study used surveys and tested the data with various statistical methods. The results showed that both students and lecturers were satisfied with the curriculum, indicating its potential contribution to the development of similar programs in other universities. The study also highlights the usefulness of the questionnaire for measuring satisfaction levels. The main limitation of the study is that it was conducted in only one university and one faculty. This study is one of the limited number of studies examining the curricula of institutions providing education in Islamic banking and finance and is one of the first to compare the satisfaction levels of both students and faculty members in a faculty.
SRI-Linked Sukuk: An Enabler for the Transition to Low-Carbon Activities
Authors: Normarianie Razali  , Rusni Hassan  , Nor Razinah Mohd Zain  , Mohd Rizal Suratman
Published: February 2025

In achieving a low-carbon economy, the Securities Commission Malaysia (SC) is facilitating companies, particularly the high-emitting greenhouse gas industry moving towards low-carbon activities with the issuance of the SRI-linked Sukuk Framework (SRILSF). This paper will analyse the SRILSF, explore the features of the SRI-linked sukuk and innovation by the issuer in selecting the Key Performance Indicators (KPIs) and Sustainable Performance Targets (SPTs) and finally, an observation of the issuance toward the institutional investors with sustainable portfolio. This paper adopted content analysis to study the characteristics, and core components of the SRILSF. Additionally, a comparative study was performed to exhibit different requirements between SRILSF with SRI Sukuk Framework and International Capital Market Association (ICMA)’s Sustainability-Linked Bond Principles (SLBP). Finally, this paper will provide an analytical review of available sustainability-linked sukuk issued in Malaysia, focusing on the core component of the sukuk. The paper acknowledges that ICMA’s SLBP is a voluntary adoption of the issuing process, while SRILSF is a Framework issued by a capital market regulator where one need complies to make an issuance, and non-compliance will result in a breach of such Framework. This paper also acknowledges there are different requirements set for the appointment of an external reviewer for post-issuance, and the credential requirements of the external reviewers set ICMA’s SLBP and SRILSF. The issuance of SC’s SRILSF is an important milestone in sustainable regulatory development of Malaysian capital market as it provides opportunities for Malaysian’ capital market issuers that seek to transition or commit to sustainable objective. The issuance of SRI-linked sukuk will attract more sustainable-focused investor, specifically institutional investors with sustainable portfolios.
Challenges for the Issuers to Issue Global Hybrid Sukuk that Complies with AAOIFI Shari’ah Standard No. 59
Authors: Muhammad Issyam Itam@Ismail  , Kamaruzaman Noordin  , Fadillah Mansor
Published: February 2025

Hybrid sukuk is a structure preferred by issuers in the global sukuk market. It requires a lower tangibility ratio requirement, i.e., at a minimum of 30% of the total sukuk issuance amount, while receivables from a commodity Murabahah transactioncan cover the rest. However, this changes with the implementation of Shari’ah Standard no. 59 on the Sale of Debt by theAccounting and Auditing Organisation for Islamic Financial Institutions (“AAOIFI”)(“S59”). It mandates a highertangibility ratio requirement of more than 50%, which has to be maintained throughout the sukuk period. When it breachesthe 33% tangibility ratio, it must be delisted and traded according to the Bay’ al-Dayn rules. The initial market reactionswere negative, and the number of sukuk issuances decreased, especially in the UAE. Many pointed out that theimplementation of S59 led to this situation. There are numerous challenges for the issuers to comply with S59, such as thelack of tangible assets to comply with the higher tangibility ratio, additional complexity in structuring a sukuk, maintaining the tangibility ratio, and incorporating the delisting event clause into the documentation.
Developing a Conceptual Shari’ah Framework of Green Sukuk for Bangladesh: Its Implications on Social Welfare by Realizing SDGs
Authors: Mohammad Habibullah  , Rusni Hassan
Published: February 2025

As a Shari’ah-compliant Islamic bond, Sukuk has attracted much interest from all over the world, particularly in Muslim countries like Bangladesh. Previous studies have confirmed that compared to interest-based bonds, Sukuk based on profit-sharing contracts is much more beneficial for investors. Specifically, in a Muslim-majority country like Bangladesh, Sukuk can attract much more interest because the existing capital market of this country severely lack Shari’ah-compliant instruments. The goal of this study is to introduce a Shari’ah-based conceptual framework of Green Sukuk that will be specifically applicable in Bangladesh considering the socio-economic conditions of the common people and the existing legal and regulatory framework of the country. In achieving this objective, a systematic literature review approach is adopted in this study. While creating the Shari’ah framework of Sukuk, importance has been given to Maqasid-al-Shari’ah and the sustainable development goals (SDGs). Emphasis has also been given on ensuring poverty alleviation and the social and economic welfare of people by highlighting the notion of hifz-al-maal (preservation of wealth) and hifz-al-deen (preservation of faith). It is expected that the new Green Sukuk model, once implemented in Bangladesh, will contribute towards achieving the SDGs, which require an unprecedented number of resources to be mobilized.
An Appraisal of Shari’ah-Compliant Commodity Options for Islamic Banks
Authors: Zaharuddin Abdul Rahman  , Maya Puspa Rahman
Published: February 2025

This paper aims to explore the potential structures of Shari’ah-compliant commodity options that would provide better alternatives for market participants in mitigating the risks associated with economic and commercial transactions. It appraises the current commodity options practiced in the conventional market and puts forward five conceptual alternatives in structuring Shari’ah-compliant commodity options while still retaining the main purpose and benefit of commodity options. Several nominated contracts in classical Islamic literature may be used to replicate certain features of conventional commodity options. The existence of these contracts is also similar to the main purpose of the options where the risk of volatility of the future commodity price is being shared with, reduced or transferred to the third party. Among the concepts are ‘urbun, hāmish jiddiyyah, wa’ad and sale contract such as istijrār, baiʿ al-ikhtiyār, salam and murabahah. Hence, this paper offers novelty in its approach to evaluating the commodity options from Shari’ah perspective, and subsequently, put forward five alternatives that can be practiced by Islamic banks all over the world.
Small and Medium Enterprise Financing in The Gambia: Role of Islamic finance
Authors: Cherno Jallow
Published: February 2025

SMEs play a crucial role in emerging and developing countries, as they contribute tremendously to income generation, job creation, and socioeconomic growth. In the Gambia, the role SMEs play in the growth and development of the economy is tremendous as the sector contributes over 60% of the urban labour force and 20% to the country’s GDP. Despite its importance, the sector still needs support from all stakeholders, including government and financial institutions. This study aims to delineate the challenges SMEs face in obtaining finance and to further explore the level of awareness and adoption of SME managers towards Islamic finance products. For a sample of 87 SMEs in the Gambia, results of the analysis indicates that, the major challenge hampering the growth of the sector among others is lack of finance. The findings also indicate that SME owners would prefer to use Islamic financial contracts to meet their financing challenges for business expansion. Thus, Islamic finance instruments can serve as a solution to the financing problems that SMEs face. Participatory contracts, such as Mudarabah and Musharakah, can play a crucial role given their risk sharing features in increasing SMEs’ financial inclusion and ultimately enhance the development of the sector. Accordingly, there is a need for the government of the Gambia to create a robust regulatory framework required for the development of the Islamic finance industry that could offer support in mitigating the financing constraints faced by SMEs.
The Potential of Micro-Takaful in Improving Financial Inclusion among Low-income Households in Ethiopia
Authors: Howlet A. Beshir  , Syed M. Alhabshi  , Habeebullah Zakariyah
Published: February 2025

In Africa, informal insurance societies are still active and have historically served as the major options for low-income households seeking financial and non-financial risk protection services. Low-income households have not had access to mainstream financial services despite the existence of these arrangements because of their numerous drawbacks. This study aims to determine whether micro-Takaful adoption has the potential to increase Islamic financial inclusion among low-income households of informal risk-sharing services users in Ethiopia. The Theory of Change (ToC) was employed in this study to understand how adoption of micro-Takaful affects financial inclusion. A mixed method design was employed to achieve the objective, and primary data was collected from 654 members of informal risk-sharing arrangements through a survey. Besides, qualitative interviews were also conducted with different stakeholders. The study found that adopting micro-Takaful has a significant impact in enhancing financial inclusion by improving financial usage and financial quality but otherwise for financial access. The findings of this research will have theoretical and practical implications.
Waqf Management Through Fintech in Malaysia
Authors: Zaki Ahmad  , Mushtaq Ahmed  , Mahvish Nawaz Mokal
Published: February 2025

Cash Waqf has gained acceptability in Malaysia, with the Malaysian National Fatwa Council issuing a fatwa allowing cash Waqf in 2007. Waqf is seen as a strong instrument that could help Malaysia's poverty problems. Waqf management in Malaysia has to be strengthened and revitalized, nevertheless. The goal of this study to provide a technology-based model (FinTech) to modernise the administration and investment of Islamic charity endowments, known as Waqf as a solution for disadvantaged areas that were being suffocated by a lack of financial goods and services. The study concludes on the note that FinTech business is an alternative platform may be accessible at any time for the beneficiaries.
Customer Satisfaction and Switching Behavior in Saudi Islamic Banks: An Exploratory Study
Authors: Altwijry Othman Ibrahim , Abduh Muhamad
Published: February 2025

Investigating Islamic banks customer satisfaction and switching behaviour is imperative for the Islamic bankingÂ industry because it could assist in explaining the level of relationship between Islamic banks and their customers.Â Accordingly, the present study is aimed at examining customer satisfaction and switching behaviour of Islamic banksâ€™Â customers for the case of Saudi Arabia. Data for this study is obtained through survey method that involves theÂ distribution of questionnaire to about 216 Islamic banksâ€™ customers in Saudi Arabia. Importance and performanceÂ analysis (IPA) method is employed to achieve the objective of this study. The finding of this study indicated that,Â internet banking, shariah compliance, confidentiality, bankâ€™s type, accuracy of bank statement, new technologyÂ adoption, and frontline friendliness dimensions fall under the quadrant of â€œkeep up the good workâ€ with high level ofÂ performance and importance. In contrast, the attributes that are located in quadrant called â€œconcentrate hereâ€ are ATMÂ location, clarity in giving explanation, promptness in giving response, staff understanding on Islamic contracts, staffhandlingÂ complaints and parking area.
Islamic Banking and Shari'ah Compliance: A Product Development Perspective
Authors: Ahmed Habib
Published: February 2025

The key difference between Islamic banks and their conventional counterparts is that the former abides by the principles of Islamic law (Shariâ€™ah). However, some Islamic banking products are criticized for not fulfilling the Shariâ€™ah requirements as these closely mimic conventional products. The article discusses how traditional Islamic contracts are used to structure Islamic modes of financing during contemporary times. To understand the choice of financing modes used by Islamic banks, the product development process is examined and the role of Shariâ€™ah related bodies in these institutions (Shariâ€™ah unit/department and Shariâ€™ah supervisory board/committee) in this process is outlined. The article contends that the choice of modes of financing used by Islamic financial institutions depend on external and internal factors. In some cases Islamic banks choose controversial modes of financing as these are the only ones that are feasible under the legal and regulatory regimes they operate under. In other cases the choice of inferior modes may result from competing internal organizational considerations whereby economic factors overshadow Shariâ€™ah requirements. The article highlights the role of Shariâ€™ah related bodies within a bank in ensuring Shariâ€™ah compliance of products.
The Role of Awareness in Islamic Bank Patronizing Behavior of Mauritanian: An Application of TRA
Authors: Mahmoud Limam Ould Mohammed , Abduh Muhamad
Published: February 2025

This paper is aimed at examining the role of awareness and the applicability of the theory of reasoned action (TRA) in predicting the intention of people to patronize Islamic Banks in Mauritania. A total of 227 respondents were involved and structural equation model was used to measure the relationship between the exogenous and endogenous variables in the model. The results have shown that TRA is a valid model in predicting the intention of Mauritanian to patronize Islamic banks in Mauritania. Attitude and subjective norm were found to have a positive influence upon the intention to patronize Islamic banks. It was also proven that awareness has a positive and significant influence upon the attitude and thus influences the intention of Mauritanian to patronize Islamic bank.
Globalisation of Islamic Financial Services and World City Networks
Authors: Hasan Abul
Published: February 2025

Islamic Financial Services (IFSs) sector is rapidly developing in the Middle East cities as well as growing in the South East Asian cities like Kuala Lumpur and Jakarta. Growth rate of this sector is notably significantly in the mainstream International Financial Centres (IFCs) such as London and New York. Currently these cities are said to be the â€˜command and controlâ€™ centres of the global economy because they harbour producer's services firms which manage increasingly complex production networks. This paper draws an analysis of rapidly expanding IFSs sector through a study of how cities are being connected through the intra-firm networks which provide Shariâ€˜ah-compliant financial services. It is argued that a focus on the globalisation of Islamic financial services (IFS) sector may provide an alternative to hegemonic imaginations of world city-formation through its focuses on globalising economic process. The relevance of such analysis is discussed against the conceptual backdrop of the world city network literature. Based on information on the locationÂ  strategies of 27 leading Islamic financial services (IFS) firms in 47 cities across the world, this study employed the methodology on â€˜globalisation and world city networkâ€™ (GaWC). The results show that globalisation within the Muslim world follows a unique urban trajectory, thereby creating a network of powerful cities. The results also show that Middle East is at the apex of the IFSs sector and Manama is identified the hub of the IFS sector which other major cities such as Amman, Dubai, Doha, Jakarta, Jeddah, Karachi, Kuala Lumpur, Kuwait, Riyadh and Istanbul etc. are also primary nodes in the city network. Outside the Muslim world, London is increasingly profiling itself as a global Islamic financial service (IFS) hub.
An Examination of Cultural-Economic Model and Public Relations in The Malaysian Islamic Banking System
Authors: Thaker Mohamed Asmy Mohd Thas , Thaker Hassanudin Mohd Thas
Published: February 2025

By adopting the study by Gaither and Kandari on cultural-economic model of, the current study was designed to analyse the cultural-economic model of public relations practice of two prominent Islamic banks (full-fledged Islamic bank and Islamic window bank) in Malaysia. This study is mainly focusing on their communication tool particularly websites and relevant reports. The study is advancing the understanding of Islam and public relations in the context of Islamic banking institution in Malaysia, an understudied area in public relation literature and enlightens the relationship between religion and public relations. The analysis has identified six Islamic value orientations elements especially respect for religious authority, affinity with the past, fatalism, communal kinship, attachment to the eternal life and spirituality and idealism relative to public relation practice among the particular Islamic banks. The study concludes with observation that there is inseparable relationship between religion and culture in the context of Islamic banking industry in Malaysia.
Regulation of Virtual Currencies: Mitigating the Risks and Challenges Involved
Authors: Muhamed Zahudi Zalina , Radin Amir Radin Ariff Taquiddin
Published: February 2025

The many types of virtual currencies that have been developed recently are due to the assessment of their users and proponents that financial systems require reform based on their mistrust in governments and financial institutions. To the users of virtual currency, its use in trade and commercial transactions suggests an attempt towards empowerment of consumers by by-passing the regulated currency regimes and intuitional regulations to create an open payments network â€“ an Internet for money. This article makes an attempt to create awareness on what virtual currency is, in highlighting the differences between virtual currency and the national currency in circulation. This would include discussion on the interaction of virtual currency with the real economy and its risk to the real economy. Further, the article draws attention to consumer protection issues and the significant consumer risks associated with the use and ownership of virtual currency. An Islamic finance perspective on virtual currency is included, given Malaysiaâ€™s dual financial system which support both conventional and Islamic finance.Â Â  Finally, this article also draws attention to some of the possible regulatory challenges that virtual currency may create.
Profit and Loss Sharing Financing, Mark-up Products or Conventional Debt? Application of Analytic Hierarchy Process
Authors: Badaj FaÃ¯rouz , Radi Bouchra
Published: February 2025

Financing SMEs is one of the most critical problems faced by entrepreneurs. PLS (Profit and Loss Sharing) and mark-up instruments are two sets of Islamic modes of financing developed as a substitute for conventional debt, which is typically adopted by SMEs. However, with larger finance offerings, it becomes more complicated for SMEs to determine the best financial instrument. Indeed, the financing decision involves a trade-off between tangible and intangible factors. Therefore, using an expertsâ€™ decision-making in evaluating financial products is a beneficial way to assist SMEs choosing the most appropriate one. The purpose of this paper is to apply the Analytic Hierarchy Process (AHP) in selecting an instrument to finance SMEs. Financial suitability, cost, risk, management intervention and profitability are the criteria upon which the financial decision is based in the current study. The results show that PLS equity finance complies with the SMEs profile more than mark-up products and traditional debt. The study has concluded with suggestions for future research.
Shari'ah Committee Composition in Malaysian Islamic Financial Institutions: Post Implementation of SGF 2010 and IFSA 2013
Authors: Itam@Ismail Muhd Issyam , Hassan Rusni
Published: February 2025

Shariâ€™ah Governance is what makes Islamic Financial Institution (IFI) different from the Conventional Financial Institution. The primary aim of Shariah Governance is to ensure that the operation, practice, instrument, product and management of the IFIs are compliant with the Shariâ€™ah principles at all times.Â  The Shariâ€™ah Governance framework has been outlined in several standard and guideline issued by various bodies and organizations. At the global level, it has been issued by IFSB and AAOIFI, while in Malaysia specifically, it has been provided by Bank Negara Malaysia (BNM) through the Shariâ€™ah Governance Framework 2010 (SGF 2010) and the newly implemented Islamic Financial Service Act 2013 (IFSA 2013). Acknowledging the significant role played by Shariâ€™ah Committee in an IFIâ€™s Shariâ€™ah Governance framework, all of the standards, guidelines and regulations mentioned above provide many provisions with regard to the Shariâ€™ah Committee in order to enhance their role and strengthen their position in the Islamic Finance industry. In this paper, focus will be given on two specific requirements, which are the requirement of qualification background of a Shariâ€™ah Committee and the minimum number of Shariâ€™ah Committee that must be appointed by an IFI. This paper will also discuss the gap between the requirements as provided by AAOIFI, IFSB, SGF 2010 and IFSA 2013, and what is the practice of the IFIs in applying these requirements.
Dynamic Linkages Among SAMI Nations (Saudi Arabia, Turkey, Malaysia, Indonesia) Equity Markets
Authors: Youcef Grimes , Adewale Abideen Adeyemi
Published: February 2025

This research paper investigates the dynamic linkages among four selected equity markets from Organization of the Islamic Conference (OIC) members. The four countries comprised the proposed Muslim BRICS called SAMI: Saudi Arabia, Ankara (Turkey), Malaysia and Indonesia. The study explores the short and long run linkages between these stock markets for the period spanning from January 2000 to September 2014 split into two sub-periods before and after the global financial crisis. Through applying Johansen co-integration analysis we found that the Indonesian, Malaysian, Saudi Arabian and Turkish stock markets are co-integrated during both periods. Emphasis was on the after crisis period where two co-integrating equations have been recorded. Granger causality test employed based on VECM further revealed that only a unidirectional relationship exist in the pre-crisis period between Saudi Arabia and Indonesia. However, bidirectional causality relationships were detected between almost all the four stock markets during the post-crisis period.
Is Gold Dinar the Appropriate Money in Islam?
Authors: Santoso Bedjo , Meera Mydin Ahamed Kameel , Ahmad Khaliq
Published: February 2025

The idea of revisiting currency and gold dinar from an Islamic standpoint as done in this paper is an interesting discourse in the current monetary system. The literature survey included historical aspect, supremacy of gold currency and the weakness of fiat money by employing maslahah-mursalah approach. The law of gold, as money, from Maqasid al-Shariâ€™ah and Siyasah Syarâ€™iyya approaches were discussed. The paper deliberated on some possible alternative forms of gold as money and then evaluated some obstacles and barriers in the hope of finding the best model of gold as money to be implemented in the current economic system. Deductive method is utilized to explore the implementation of gold currency based on historical study and library research. The findings revealed that, money is not limited to gold and silver. However, by using derivation from based on process from sources of law-making, the â€˜hukmâ€™ of gold/silver as money is permissible. While, the hukm for the country to mint gold dinar is subject to change into wajib, if the objective is to protect nation and people from harm. Maqasid al-Shariâ€™ah and maslahah-mafsadah studies have also strengthened the view. Moreover, the review indicated that gold as money serves maslahah while fiat money serves more mafsadah.  However, it is difficult to implement gold dinar monetary system in the current system due to some impediments. Backed by information/communication technology and adequate political will, gold may, however be employed as measurement of value; and as such could be implemented in certain communities including cooperatives.
The Influence of Financial Education on Consecutive Debt-taking Behaviour of Low-Income Households in Indonesia
Authors: Arsyianti Laily Dwi , Kassim Salina
Published: February 2025

Debt is considered as one of the major sources of funds from third party, especially for low-income households. Even though Islam allows debt, it should not be used recklessly. Taking one debt after another is apparently not suggested for the low-income households although it is common among them. In order to understand the consecutive debt-taking behaviour among the low income households in Indonesia as well as the role of financial education in influencing this behaviour, this study adopts the Structural Equation Modelling (SEM) to analyse pertinent data elicited from 1,780 low-income households from six areas in Indonesia. The study finds that financial education has positive effect on using debt consecutively albeit wisely for fulfilling family needs. By wisely, it means that the low income households are able to control their desire and satisfaction, thus practicing the true spirit of consumption as proposed in Islam.
An Analysis on Islamic Social Finance for Protection and Preservation of MaqÄá¹£id al-SharÄ«â€˜ah
Authors: Mohd Zain Nor Razinah , Engku Ali Engku Rabiah Adawiah
Published: February 2025

Islamic social finance is akin to the conventional social finance but the former is subjected to the established principles of SharÄ«â€˜ah. In generating positive impacts to the society, the Islamic social finance and its instruments must be utilised in protecting and preserving the MaqÄá¹£id al-SharÄ«â€˜ah. A critical analysis on the Islamic social finance in relation to the MaqÄá¹£id al-SharÄ«â€˜ah is provided through this research. By using the doctrinal and qualitative methods, the practices of the Islamic social finance as applied in OIC member states are reviewed and provided as examples. Problems of implementation of Islamic social finance in the OIC countries are listed; while tentative solutions are suggested with a hope of triggering better solutions. At the end of discussion, a list of recommendations for future researches is proposed for considerations.
Bank Performance and Shari'ah Supervisory Board Attributes on Islamic banks: Does Bank Size Matter?
Authors: Nomran Naji Mansour , Haron Razali , Hassan Rusni
Published: February 2025

This study aims to provide new empirical evidence on whether the impact of Shariâ€™ah Supervisory Board (SSB) characteristics on Islamic Banks (IBs) performance can be affected by the size of the bank by using a sample of 25 banks for the period from 2007 to 2015. Six SSB characteristics were employed as explanatory variables which are (size, cross-membership, educational qualification, reputation, experience and change in the composition). By employing random-effects GLS and GMM method for a robustness check, it is found that four SSB characteristics (size, cross-membership, educational qualification and change in the composition) significantly affect the performance of IBs when the full sample is examined. However, the findings vary when the sample is divided into two subsamples, large and small bank. Four SSB characteristics (size, cross-membership, reputation and experience) are found to play an important role in enhancing the performance of large IBs while only (reputation and experience) significantly affect the performance of small IBs. This confirms that the impact of SSB characteristics on performance concentrates more on large IBs as compared to the small banks. Thus, there is a lack of Shariâ€™ah governance practices in the small IBs in Malaysia and Indonesia as compared to the large banks.
HASBLE Card: Innovation on Company Funding Using Shari'ah Venture Capital Toward Halal Industry in Indonesia
Authors: Majid Rifaldi , Agassi Billal Andre
Published: February 2025

The growth of the Muslim population in the world is the main driver of growth for global halal products.  In Indonesia, Law No.33 of 2014 on the Guarantee of halal products provides significant opportunities for the development of innovative products given the potential of huge Indonesian Muslim population.  In the process,  requirements to use halal certification in trade as mandated by the national law brings about a dilemma to the halal industry players as well as micro, small, and medium enterprises (SMEs). The problem of capital and funding are the key issues. Stakeholders are faced with the problems of production and sustainability, procurement of equipment and materials production, marketing, and internal reinforcement. This qualitative paper offers a review of the literature.  The purpose of this paper is to understand how the model of innovative funding through Shairâ€™ah venture capital firms spur the growth and development of the halal industry. Halal Sustainable (HASBLE) card is an innovative model of mudharabah and musyarakah transaction, which are realized in a sustainable funding by Shairâ€™ah venture capital firms to halal industry players. The allocation of the profit-sharing is based on the contract by setting some parts aside in the card as productive deposit.  These deposits will be managed as a productive stimulus funds for the maintenance of halal certification, training and business assistance, and the balance of HASBLE card itself. HASBLE card is innovative model that has sustainable funding agreement involving several stakeholders in order to improve productivity, growth, and the existence of halal products in the global trade arena.
The Impact of Financial Services Globalisation on Islamic and Conventional Bank Performance in GCC and MENA Countries
Authors: Bankole Abiodun Surajudeen , Kareem Muritala Kewuyemi
Published: February 2025

Empirical researches have shown that Islamic banks were more efficient than the conventional banks before, during and after global financial crises and were more resilient to negative profitability and speculation commonly identified with conventional banks despite that the former have grown as a result of globalisation of financial markets, product innovation, and delimitation of financial regulations, among others. However, the analyses of globalisation or internationalisation of financial services have concentrated only on the cross-border flow of portfolio investment in country stock markets, ignoring foreign direct investment and movement of financial services professionals. Using panel regressions to analyse the impact of financial services globalisation, the paper finds that net capital account used to measure the phenomenon has no significant impact on Islamic banksâ€™ performance measured in terms of return on equity, return on asset and profit before tax. This may be due to the oft-cited limited patronage for Islamic banking in general. The policy implication suggests the need for an increased drive to popularise Islamic banking products in non-Islamic countries and for Islamic banks to more actively engage in cross-border trade of Islamic banking services as well as foreign direct investment in subsidiary banks outside their traditional locations.
Key words: Financial services, globalisation, Islamic banks, GCC and MENA
JEL Classification: G21, G24, G15
Issues and Challenges in Management of Waqf in Ningxia Province of China
Authors: Ma Binghai , Kassim Salina
Published: February 2025

Waqf institutions in China are facing several issues and challenges such as waste of charitable resources, difficulties in retaining Waqf assets, and low levels of professionalism of those involved in Waqf. The internal management mechanisms of these institutions continue to be designed and controlled to support personal ambitions and control as opposed to the more religious considerations advocated by Islam that align with the purpose of Waqf. Despite this formidable challenge that permeates Waqf in China, there has been a lack of research on these issues. This paper aims to fill this lacuna in the literature by investigating and assessing the management mechanism and national governance of both general and Islamic aspects of Waqf in China. The paper adopts a qualitative method using semi-structured interviews with several senior Waqf managers. The findings highlight several issues and challenges facing Waqf in China, including the lack of a defined aim, low level of capability and professionalism, narrow-mindedness, and poor levels of coordination. Other issues include brain drain, unstable performance, low qualification, and managerial neglect of Waqf managers. Lastly, the findings elaborate the balance point between Chinaâ€™s national governance and Islamic governance.
The Significance of Corporate Social Responsibility Disclosure to Islamic Banks in Malaysia: An Islamic View
Authors: Wan Jusoh Wan Noor Hazlina , Ibrahim Uzaimah
Published: February 2025

Corporate social responsibility disclosure (CSRD) is imperative for an institution as it assists decision makers in making economic decisions. However, for Islamic institutions like Islamic banks, these objectives are secondary. For Islamic banks, to show their compliance with Shariâ€™ah is the main objective of their CSRD that overrules other objectives. Nevertheless, there is no special framework on corporate social responsibility (CSR) for Islamic financial institutions in Malaysia especially Islamic banks thus far to guide them on what should be disclosed in their annual reports although Malaysia is one of the leading global hub for Islamic finance. Hence, the purpose of this study is to determine the significance of CSRD to Islamic banks in Malaysia from an Islamic view. This study is based on primary Shariâ€™ah sources i.e. al-Qurâ€™an and al-Sunnah, and secondary Shariâ€™ah sources. It was found that, it is obligatory for all Islamic banks in Malaysia to disclose their CSR activities and initiatives through a right and common platform, which is CSRD. Therefore, a special CSR framework is required to guide Islamic banks in Malaysia disclose their CSR activities or initiatives systematically and perfectly
Gap Analysis Between the Rahn Exposure Draft by Bank Negara Malaysia and Rahn Practice in Islamic Pawn Broking Institutions
Authors: Faakihin Nur , Hassan Rusni
Published: February 2025

This paper aims to analyse the existing structure of rahn-based Islamic microcredit lending facilities by Bank Kerjasama Rakyat and Pos Malaysia, the two institution with the largest number of Rahn branches in Malaysia, in comparison with the Exposure Draft on Shariâ€™ah Requirements and Optional Practices of Rahn issued by Bank Negara Malaysia (BNM). The Exposure Draft delineates the Shariâ€™ah requirements and Optional Practices pertaining to Rahn such that the regulatory body seeks feedbacks and alternative proposals from stakeholders to enhance the current practise of rahn. The main purpose of this paper is to investigate whether the practices of Bank Kerjasama Rakyat and Pos Malaysia comply with the proposed policy document by BNM with regard to the Shariâ€™ah aspects. This paper employs a qualitative research method based on the data gatherred from secondary sources from the literature and other academic materials including the Rahn exposure draft, in order to evaluate the theoretical and practical aspects of rahn in Islamic microcredit financing. The findings show that in general, the current rahn practices by Bank Kerjasama Rakyat and Pos Malaysia are in accordance with the Shariâ€™ah requirement in the Rahn Exposure Draft issued by BNM, based on available information. However, there are a some concerns regarding the current rahn practices related to the precautious measure before accepting the marhun (pledged item) to ensure the marhun is recognized by Shariâ€™ah and the basis of the imposition of safekeeping fee to customers. As such, these issues call for a further examination and appropriate remedy.
Structural Development of Ijarah Sukuk: An Appraisal
Authors: Auwal Adam Sa'ad
Published: February 2025

Sukuk structures rely on the performance of an underlying asset or on a contractual arrangement pertaining to that specific asset. This makes sukuk an important facility in Islamic finance since it can be used to provide regular payments throughout the life of the financing plan. This study highlights some important sukuk structures, such as ijarah for asset acquisition and sukuk with a sale and lease-backed structure. Additionally, this study suggests some important proposals to help overcome the Shariâ€™ah issues in sukuk structures. This study suggests that sukuk structures involving the combination of sale and lease-backed contracts should involve a third party who enters into the Ijarah transaction with the investors rather than the originator himself. A benefit of this change will help avoid Inah Ijariyyah (Inah trick for) in the structure. The sukuk structure for asset securitization on the other hand, should not be traded in the secondary market because it involves a sale of debt for debt which is prohibited according to the Shariâ€™ah principles. As for the forward lease sukuk, sukuk holders should wait for the commencement of the project before trading their sukuk in the secondary markets. This is to ensure that the Ijarah property exists before the sale process began.