JURISTIC VIEWPOINTS ON BAYC Al-CINAH IN MALAYSIA: A SURVEY

Saiful Azhar Rosly; Azizi Che Seman

doi:10.31436/ijema.v11i1.87

Authors

Saiful Azhar Rosly Associate Professor, Department of Economics, Kulliyyah of Economics and Management Sciences, International Islamic University Malaysia, Jalan Gombak, 53100 Kuala Lumpur, Malaysia. (e-mail: saiful@iiu.edu.my)
Azizi Che Seman Lecturer, Department of Sharicah and Economics, Academy of Islamic Studies, University of Malaya, 59100 Kuala Lumpur, Malaysia. (e-mail: azizi@um.edu.my)

DOI:

https://doi.org/10.31436/ijema.v11i1.87

Abstract

In Malaysia, Sharicah scholars at the supervisory levels have advocated bayc al-cinah as a mode of finance. Under the label of al-bayc, the contract of bayc al-cinah contains interest-bearing features, such as earning a contractual return without the implication of risk and value-addition. Seeking a broader consensus on the permissibility of bayc al-cinah is thus critical. This study shows that Malaysian Sharicah scholars outside the supervisory bodies do not fully support bayc al-cinah. The survey indicates that bayc al-cinah can be applied under a state of darurah or when the maslahah of the Muslim people is under threat, which is not the case in Malaysia. Since Sharicah scholars in Middle-Eastern countries have condemned bayc al-cinah, it is crucial that a diversification policy is pursued to invite greater participation of global Islamic funds in Malaysia.

JEL classification: G10, Z12

Key words: Islamic financing, Bayc al-cinah, Riba