Unveiling the terrain of non-bank Islamic personal financing: current practices, challenges, and future prospects

Ibtisam @ Ilyana Ilias, Mastika Nasrun, Nurul Aini Muhamed
{"title":"Unveiling the terrain of non-bank Islamic personal financing: current practices, challenges, and future prospects","authors":"Ibtisam @ Ilyana Ilias, Mastika Nasrun, Nurul Aini Muhamed","doi":"10.1108/jiabr-07-2023-0221","DOIUrl":null,"url":null,"abstract":"<h3>Purpose</h3>\n<p>This study aims to investigate the current practices among selected non-bank financial institutions (NBFIs) in Malaysia in offering Islamic personal financing and the multiple challenges faced by them.</p><!--/ Abstract__block -->\n<h3>Design/methodology/approach</h3>\n<p>The qualitative research methodology was used, and primary data was collected using semi-structured interviews with 10 respondents consisting of NBFIs’ representatives and Shariah advisors.</p><!--/ Abstract__block -->\n<h3>Findings</h3>\n<p>Most Islamic personal financing practice is based on tawarruq. Among the major challenges faced by NBFIs are the absence of a comprehensive legal framework, Shariah non-compliance risks, cost, human resources and risk management. Recommendations include establishing a proper legal framework and Shariah governance. The study also recommends centralising at the regulatory level aspects such as training, commodity murabahah system and the department performing the Shariah advisory and control functions.</p><!--/ Abstract__block -->\n<h3>Research limitations/implications</h3>\n<p>Online interviews were conducted during the early wave of the COVID-19 pandemic in 2020 with a limited number of respondents due to people’s hesitancy to participate during the pandemic.</p><!--/ Abstract__block -->\n<h3>Practical implications</h3>\n<p>The findings will guide regulators and industry players concerning the challenges that must be addressed and the recommendations that can be considered in ensuring complete adherence to Shariah principles for the offering of personal financing. Eventually, Muslim society in need of cash will benefit from the broader choice of Shariah-compliant personal financing.</p><!--/ Abstract__block -->\n<h3>Social implications</h3>\n<p>The research highlights the weaknesses of self-regulation in guaranteeing Shariah compliance and the need for regulatory intervention.</p><!--/ Abstract__block -->\n<h3>Originality/value</h3>\n<p>This is a pioneering empirical study that investigated the offering of Islamic personal financing among NBFIs in Malaysia, the challenges and the way forward.</p><!--/ Abstract__block -->","PeriodicalId":46046,"journal":{"name":"Journal of Islamic Accounting and Business Research","volume":"2 1","pages":""},"PeriodicalIF":2.5000,"publicationDate":"2024-08-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Islamic Accounting and Business Research","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1108/jiabr-07-2023-0221","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 0

Abstract

Purpose

This study aims to investigate the current practices among selected non-bank financial institutions (NBFIs) in Malaysia in offering Islamic personal financing and the multiple challenges faced by them.

Design/methodology/approach

The qualitative research methodology was used, and primary data was collected using semi-structured interviews with 10 respondents consisting of NBFIs’ representatives and Shariah advisors.

Findings

Most Islamic personal financing practice is based on tawarruq. Among the major challenges faced by NBFIs are the absence of a comprehensive legal framework, Shariah non-compliance risks, cost, human resources and risk management. Recommendations include establishing a proper legal framework and Shariah governance. The study also recommends centralising at the regulatory level aspects such as training, commodity murabahah system and the department performing the Shariah advisory and control functions.

Research limitations/implications

Online interviews were conducted during the early wave of the COVID-19 pandemic in 2020 with a limited number of respondents due to people’s hesitancy to participate during the pandemic.

Practical implications

The findings will guide regulators and industry players concerning the challenges that must be addressed and the recommendations that can be considered in ensuring complete adherence to Shariah principles for the offering of personal financing. Eventually, Muslim society in need of cash will benefit from the broader choice of Shariah-compliant personal financing.

Social implications

The research highlights the weaknesses of self-regulation in guaranteeing Shariah compliance and the need for regulatory intervention.

Originality/value

This is a pioneering empirical study that investigated the offering of Islamic personal financing among NBFIs in Malaysia, the challenges and the way forward.

查看原文
分享 分享
微信好友 朋友圈 QQ好友 复制链接
本刊更多论文
揭开非银行伊斯兰个人融资的面纱:当前做法、挑战和未来前景
本研究旨在调查马来西亚部分非银行金融机构(NBFIs)在提供伊斯兰个人融资方面的现行做法及其面临的多重挑战。本研究采用定性研究方法,通过对 10 名受访者(包括 NBFIs 代表和伊斯兰教法顾问)进行半结构式访谈来收集原始数据。非银行金融机构面临的主要挑战包括缺乏全面的法律框架、违反伊斯兰教法的风险、成本、人力资源和风险管理。建议包括建立适当的法律框架和伊斯兰教法管理。研究的局限性/影响在线访谈是在 2020 年 COVID-19 大流行的初期进行的,由于人们在大流行期间不愿参与,因此受访者人数有限。最终,需要现金的穆斯林社会将从更广泛的符合伊斯兰教法的个人融资选择中获益。社会影响研究强调了自律在保证符合伊斯兰教法方面的弱点,以及监管干预的必要性。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
求助全文
约1分钟内获得全文 去求助
来源期刊
CiteScore
4.80
自引率
22.70%
发文量
78
期刊介绍: The journal provides a dynamic forum for the advancement of accounting and business knowledge based on Shari’ah and Islamic activities that have an impact on the welfare of society. JIABR publishes articles on the interplay between Islamic business ethics, accounting, auditing and governance, in promoting accountability, socio-economic justice (adl) and everlasting success (al-falah). It seeks to inform, among others, current theoretical and empirical research and practice in Islamic accounting, auditing and corporate governance, management of Islamic organizations, accounting regulation and policy for Islamic institutions, Shari’ah auditing and corporate governance, financial and non-financial performance measurement and disclosure in Islamic institutions and organizations. All styles of research, theoretical and empirical, case studies, practice-based papers and research notes that are well written and falling within the journal''s scope, are generally welcomed by the journal. Scope/Coverage Development of accounting, auditing and corporate governance concepts based on Shari’ah Socio-political influence on accounting and auditing regulation and policy making for Islamic financial institutions and organizations Historical perspectives on Islamic accounting, auditing and financial management Critical analysis on issues and challenges on accounting disclosure and measurement, Shari’ah audit and corporate governance Controls and risks in Islamic organizations Financial and non-financial performance measurement and disclosure.
期刊最新文献
Exploring the antecedents and consequences of brand addiction among Iranian consumers Bridging the gap between the tradition of the Prophet in zakat payment and the current practice, through modern measurement Corporate governance and firm performance: in Qatari non-financial firms Factors influencing SME project returns on Islamic Fintech lending platform Exploring the feasibility of Muzara’ah based Islamic running finance model as an alternative for agriculture credit
×
引用
GB/T 7714-2015
复制
MLA
复制
APA
复制
导出至
BibTeX EndNote RefMan NoteFirst NoteExpress
×
×
提示
您的信息不完整,为了账户安全,请先补充。
现在去补充
×
提示
您因"违规操作"
具体请查看互助需知
我知道了
×
提示
现在去查看 取消
×
提示
确定
0
微信
客服QQ
Book学术公众号 扫码关注我们
反馈
×
意见反馈
请填写您的意见或建议
请填写您的手机或邮箱
已复制链接
已复制链接
快去分享给好友吧!
我知道了
×
扫码分享
扫码分享
Book学术官方微信
Book学术文献互助
Book学术文献互助群
群 号:481959085
Book学术
文献互助 智能选刊 最新文献 互助须知 联系我们:info@booksci.cn
Book学术提供免费学术资源搜索服务,方便国内外学者检索中英文文献。致力于提供最便捷和优质的服务体验。
Copyright © 2023 Book学术 All rights reserved.
ghs 京公网安备 11010802042870号 京ICP备2023020795号-1