Citation
Shamim, A. (2010), "E-commerce from an Islamic perspective", Journal of Islamic Marketing, Vol. 1 No. 2. https://doi.org/10.1108/jima.2010.43201bae.001
Publisher
:Emerald Group Publishing Limited
Copyright © 2010, Emerald Group Publishing Limited
E-commerce from an Islamic perspective
Article Type: Article review From: Journal of Islamic Marketing, Volume 1, Issue 2
Zainual, N., Osman, F. and Mazlan, S.H. (2004), "E-commerce from an Islamic perspective" Electronic Commerce Research and Applications Vol. 3, pp. 280-93.
E-commerce, as a new way of doing business, is fundamentally different from the traditional business paradigm. It took the convergence of several information technologies and business practices for it to evolve. Its advantages are many and hard to overlook. For example, its noticeable ability to reduce the transaction costs which have been traditionally high is considered as a one of the key factors that continue to increase its popularity.
As e-commerce continues to gain an ever-increasing market share across the world, many Muslims are questioning its Islamic permissibility and legality as new form of business, i.e. whether it is acceptable under the teachings of the Shariah (Islamic law). The authors set to answer this particularly important question through studying various related aspects such as transactions, rights of producers and customers, payments through credit cards, Islamic business ethics, e-commerce contracts and types of contracts in Islam. The authors rely in their answers on two main sources of Islamic teachings: the holy book of Islam (the Quran) and the Sunnah, or the practices of Mohammad (the Prophet of Islam).
The authors conclude by stating that Islam encourages e-commerce as a new way or technology of doing business. However, they state that Muslims engaging in it need to ensure they adhere to the Islamic principles of business conduct; the transactions should be carried out in the truthful manner, there should be clarity in communication, avoiding interest (Riba’), ensured all the pillars of Islamic contract are met and guaranteed the rights of producers and consumers.
The authors also contend that regardless of the mode of business conduct, Muslims have to be faithful and God-fearing in their business dealings and that it is their duty to ensure that these dealings are in accordance with the teachings provided in the various Islamic sources, mainly the Quran and the Sunnah. Above all, Muslims need to remember that all that they do, whether business or otherwise, is for the sake of Allah, not for the sake of worldly gains.
Throughout the paper, the authors provide insightful information on the Islamic business conduct. A significant part of their discussion focused on contracts in Islam where they describe the various types of the Islamic contracts such as ordered sale, manufacturing sale and deferred sale. They also introduce the reader to the four pillars that must be fulfilled to make these contracts Islamic:
- 1.
an offer (made by the first party to the contract);
- 2.
acceptance (providing freedom to the second party to accept the offer);
- 3.
the subject matter (the object of the sale and it must be lawful and beneficial); and
- 4.
mode of expression (the manner of speaking of both the contracting parties about their wills).
The authors also explain how these pillars relate to the concept of e-commerce through discussing the five stages that ensure the validity of a business transaction from an Islamic perspective, including e-commerce contracts:
- 1.
the initiating of the contract, or having both parties or their agents present;
- 2.
confirming the contract validity (Sihha), or ensuring that the contract is free from interest, uncertainty, deceit or fraud, duress and gambling;
- 3.
implementation (Nafath), or ensuring that the product is free from any liabilities and that the person offering the product is the real owner or a legal agent;
- 4.
binding (Ilzham), whereby contracting parties sign a lawful contract; and
- 5.
delivery (state of exchange), whereby contracting parties exchange value.
At this last point in particular, the authors advise against the use of credit cards for payments and recommend using other alternatives. Nonetheless, they note that the use of credit cards to settle payments in e-commerce is permissible or Halal if the customer paid the whole bill before the due date.
However, while the authors seem to declare a business Fatwa, relying on and sighting Islamic sources, it is important to note that for a Fatwa to be sound it must be issued by one who is knowledgeable in both the matter under consideration and the related religious rulings. Because of the complexity of commerce nowadays, it is becoming increasingly difficult to find people who have sufficient knowledge in both religion and commerce. That is why Fatwa is becoming more institutionalized, i.e. issued by institutions composed of people with diverse expertise and knowledge instead one individual. Whether the authors of the paper had access to such knowledge is not explained in the paper.
Amjad Shamim