Reputation Oversight by the Sharia Supervisory Board Toward Wakalah Contract Application on Murabahah Financing

DOI

10.2991/assehr.k.200529.164How to use a DOI?

Keywords

supervision reputation, wakalah agreement, murabahah financing

Abstract

As we know that the Sharia Supervisory Board (DPS) has a very important role in overseeing various sharia banking products and operations. DPS will oversee violations of sharia principles which will tarnish the reputation and credibility of sharia banking. Various challenges faced by the Islamic banking system such as in supervising the application of wakalah contracts on murabaha financing to be in accordance with sharia principles. DPS as an institution that is authorized to oversee the alignment of Islamic banking operations with the DSN fatwa is shrouded in a number of issues. First, until now, there is no specific law that is used as a reference for supervision of Islamic banking cases. Second, there is no authority to act decisively on the results of supervision. DPS can only give warnings but cannot close down banking business problems, and supervision by DPS has been ignored. Third, moreover, DPS is appointed and paid by Islamic banks. Things like influencing process control and result control are misleading, just formalities. This is not the right way to maintain the reputation of Islamic banks in providing services in accordance with Islamic principles. To overcome various problems, this study adopted an analytical method based on doctrinal content, by applying four types of legal approaches, namely: (i) historical/historical; (ii) fiqh/philosophy; (iii) comparison; and (iv) analytical and critical. In addition, a harmonious approach is needed to harmonize the reputation of supervision of the application of the wakalah contract to murabahah financing to conform to sharia principles.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Bagya Agung Prabowo
PY  - 2020
DA  - 2020/05/04
TI  - Reputation Oversight by the Sharia Supervisory Board Toward Wakalah Contract Application on Murabahah Financing
BT  - Proceedings of the 1st Borobudur International Symposium on Humanities, Economics and Social Sciences (BIS-HESS 2019)
PB  - Atlantis Press
SP  - 775
EP  - 781
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.200529.164
DO  - 10.2991/assehr.k.200529.164
ID  - Prabowo2020
ER  -