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The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective

The concept of promise in Islamic banking contracts is a novel tool that has been introduced as a result of recent advancements. Wa’d has grown in popularity in recent years because it provides great flexibility. It was primarily developed by Malaysia’s Islamic banks for product structuring. However...

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Main Authors: Yaakub, Fadziani, Buang, Ahmad Hidayat
Format: Article
Language:English
Published: UUM Press 2024
Subjects:
HG Finance
Online Access:https://repo.uum.edu.my/id/eprint/30367/1/IJBF%2019%2001%202024%2039-56.pdf
https://doi.org/10.32890/ijbf2024.19.1.2
https://repo.uum.edu.my/id/eprint/30367/
https://e-journal.uum.edu.my/index.php/ijbf/article/view/18383
https://doi.org/10.32890/ijbf2024.19.1.2
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spelling my.uum.repo.303672024-02-05T08:23:14Z https://repo.uum.edu.my/id/eprint/30367/ The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective Yaakub, Fadziani Buang, Ahmad Hidayat HG Finance The concept of promise in Islamic banking contracts is a novel tool that has been introduced as a result of recent advancements. Wa’d has grown in popularity in recent years because it provides great flexibility. It was primarily developed by Malaysia’s Islamic banks for product structuring. However, there are issues arising from this principle, which is considered to be against Shariah and merely intended to preserve the bank’s interests, which is of course, contrary to Maqasid al-Shariah. The purpose of this study is to look into the significance of the promise concept in Islamic banking contracts, taking into account the maslahah and mafsadah principles recommended in Maqasid al- Shariah. The study uses a qualitative approach as it allows a more in-depth understanding of the subject matter. Data were gathered using published literature and information from the official website of Bank Negara Malaysia (BNM). A semi-structured interview was conducted with three Shariah experts from the Shariah Advisory Council of Bank Negara Malaysia (SACBNM) and two industry practitioners from Bank Islam Malaysia Berhad (BIMB) and Maybank Islamic Berhad (MIB). The data obtained was analysed using the content analysis approach. In sum, the examination of Islamic law sources and discussions with Islamic scholars revealed that the use of the principle of promise in Islamic banking transactions can benefit the micro and macro economy. The concept of promise in Islamic banking contracts can benefit both customers and Islamic banks, particularly in terms of meeting consumer needs, generating profit for Islamic banks, as well as contributing to the country’s development (maqasid kulliyah). UUM Press 2024 Article PeerReviewed application/pdf en cc4_by https://repo.uum.edu.my/id/eprint/30367/1/IJBF%2019%2001%202024%2039-56.pdf Yaakub, Fadziani and Buang, Ahmad Hidayat (2024) The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective. International Journal of Banking and Finance (IJBF), 19 (1). pp. 39-56. ISSN 2811-3799 https://e-journal.uum.edu.my/index.php/ijbf/article/view/18383 https://doi.org/10.32890/ijbf2024.19.1.2 https://doi.org/10.32890/ijbf2024.19.1.2
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Institutional Repository
url_provider http://repo.uum.edu.my/
language English
topic HG Finance
spellingShingle HG Finance
Yaakub, Fadziani
Buang, Ahmad Hidayat
The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
description The concept of promise in Islamic banking contracts is a novel tool that has been introduced as a result of recent advancements. Wa’d has grown in popularity in recent years because it provides great flexibility. It was primarily developed by Malaysia’s Islamic banks for product structuring. However, there are issues arising from this principle, which is considered to be against Shariah and merely intended to preserve the bank’s interests, which is of course, contrary to Maqasid al-Shariah. The purpose of this study is to look into the significance of the promise concept in Islamic banking contracts, taking into account the maslahah and mafsadah principles recommended in Maqasid al- Shariah. The study uses a qualitative approach as it allows a more in-depth understanding of the subject matter. Data were gathered using published literature and information from the official website of Bank Negara Malaysia (BNM). A semi-structured interview was conducted with three Shariah experts from the Shariah Advisory Council of Bank Negara Malaysia (SACBNM) and two industry practitioners from Bank Islam Malaysia Berhad (BIMB) and Maybank Islamic Berhad (MIB). The data obtained was analysed using the content analysis approach. In sum, the examination of Islamic law sources and discussions with Islamic scholars revealed that the use of the principle of promise in Islamic banking transactions can benefit the micro and macro economy. The concept of promise in Islamic banking contracts can benefit both customers and Islamic banks, particularly in terms of meeting consumer needs, generating profit for Islamic banks, as well as contributing to the country’s development (maqasid kulliyah).
format Article
author Yaakub, Fadziani
Buang, Ahmad Hidayat
author_facet Yaakub, Fadziani
Buang, Ahmad Hidayat
author_sort Yaakub, Fadziani
title The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
title_short The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
title_full The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
title_fullStr The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
title_full_unstemmed The Application of Promise (Wa‘D) in Islamic Banking Contracts in Malaysia: A Maslahah Perspective
title_sort application of promise (wa‘d) in islamic banking contracts in malaysia: a maslahah perspective
publisher UUM Press
publishDate 2024
url https://repo.uum.edu.my/id/eprint/30367/1/IJBF%2019%2001%202024%2039-56.pdf
https://doi.org/10.32890/ijbf2024.19.1.2
https://repo.uum.edu.my/id/eprint/30367/
https://e-journal.uum.edu.my/index.php/ijbf/article/view/18383
https://doi.org/10.32890/ijbf2024.19.1.2
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score 13.211869

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