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This study aims to examine the resolutions issued by the Sharīʿah Advisory Council of Bank Negara Malaysia (SAC-BNM), which have recognized maṣlaḥah (public interest) as the basis of ruling to see the extent of its usefulness to the public and the extent of its adherence to the maṣlaḥah parameters. The study will also look into the opposing opinion to identify the basis of rejection and overall implication on Islamic finance based on opposing opinions of SAC-BNM and other bodies of collective ijtihād (juristic interpretation).

The study uses a qualitative approach by analyzing the SAC-BNM resolutions, which have been resolved based on maṣlaḥah. The study also applies the comparative approach by comparing the fatwa (Sharīʿah pronouncement) issuing bodies of Malaysia and the Gulf Cooperation Council countries. Furthermore, the secondary data is obtained from sources such as uṣūl al-fiqh (theory of Islamic jurisprudence) books, papers and relevant internet sources.

The study found that SAC-BNM’s resolutions are in line with some of the major maṣlaḥah parameters mentioned in the uṣūl al-fiqh sources i.e. must not contradict with the Qurʾān and the Sunnah. While looking at the other two criteria of being in line with ijmāʿ (consensus) and having a general impact, such resolutions might not fulfill the criteria of valid maṣlaḥah considering, respectively, the stand of collective ijtihād or the impact on the group of customers and institutions.

Most available shari’ah (Islamic law) research considers the perspective of fiqh (Islamic jurisprudence) while analyzing the issue of maṣlaḥah. This study aims to conduct analysis based on uṣūl al-fiqh. Moreover, maṣlaḥah itself is a broad concept, which can be abused. Hence, this study discusses the parameters of maṣlaḥah to understand the validity of an important juristic tool in Sharīʿah.

This paper aims to explore the practical role of maqasid al-Shari’ah in applying fiqh muamalat to the reality of modern banking practices. As the modern financial environment is complicated and not too conducive for Islamic banking operations, a special approach based on maqasid al-Shari’ah is needed to harmonize between revelation and reality.

The data of this study are obtained through literature and empirical data. As for the empirical, the exploratory qualitative approach is applied in which three members of the Shari’ah Advisory Council (SAC) of Bank Negara Malaysia (BNM) as well as three Shari’ah committees (SC) of Islamic Finance Institutions are selected as interviewees. As a result, several themes are defined from the interview data before they are analyzed based on the concept of maqasid al-Shari’ah.

The findings reveal that several practices are prevalent in developing Islamic banking products, including replicating conventional products to be Islamic ones, imposing wa’ad (unilateral promise) to strengthen the combination of different contracts into one product, and adopting floating rate with ibra’ (rebate) for financing price, which are needed to sustain this industry in modern financial system. In this regard, maqasid al-Shari’ah is applied to reconcile between rulings in fiqh muamalat and banking environments, so that these rulings can be adopted pragmatically without compromising Shari’ah principles.

This study has its limitations, as it focuses on the extent of the role of the maqasid al-Shari’ah in Islamic banking operations, excluding other segments of Islamic finance such as Islamic capital markets and Islamic insurance. Moreover, as data are collected from only six interviewees from SAC and SC of Malaysia, the results cannot be represented for the whole Islamic banking practices of this country.

This study provides several policy recommendations regarding the practice of the maqasid al-Shari’ah in Islamic banking. These may be useful for all Islamic finance players, including regulators and bankers in introducing policies and products in this area.

This study has the potential to enhance the confidence of the Muslim community, particularly in Islamic banking to support its existence and practices. The impact of such optimism will lead to an increase in demand for Islamic banking products, hence encouraging Islamic banking to sustain and update its activities in line with maqasid al-Shari’ah.

This paper offers a practical approach as regards to how the maqasid al-Shari’ah can play a significant role in sustaining the Islamic banking industry, particularly in circumstances that are not favorable to its progress. It is indispensable to prevent the Islamic rulings from being diverted in the name of human well-being and to avoid basing them on a literal textual approach. Moreover, as it provides empirical studies on the issue of replication, wa’ad, floating rate and ibra’, the discussion on this subject becomes more practical.

This paper aims to scrutinize the misconceptions about maqāṣid al-Sharīʿah (objectives of Islamic law) that complicate its actualization, particularly in Islamic finance.

This study adopts a qualitative inductive method to identify the flaws in understanding maqāṣid al-Sharīʿah vis-à-vis Islamic finance. It uses the views of classical and modern maqāṣid scholars to critically examine the flaws.

This study concludes that the five objectives of the Sharīʿah constitute the framework of maṣlaḥah (well-being). The levels of maṣlaḥah ― namely ḍarūriyyāt (essentials), ḥājiyyāt (needs) and taḥsīniyyāt (embellishments) ― are the categories of the means to ends. The demand for financial products falls under the ḥājiyyāt and taḥsīniyyāt categories, not ḍarūriyyāt. The maqāṣid (objectives) are derived from aḥkām (provisions) being verified by the parameters, while aḥkām are guided by maqāṣid.

This study recommends further research to theorize the concepts of ḍarūriyyāt, ḥājiyyāt, taḥsīniyyat and mukammilāt (complements); to harmonize the maqāṣid with their essential elements and to formulate a conceptual framework for actualizing maqāṣid al-Sharīʿah in Islamic finance.

This paper will improve perceptions and bridge gaps between the understanding of maqāṣid theory and existing practices. It suggests that instead of ḍarūriyyāt, Islamic financial institutions (IFIs) should refer to ḥājiyyāt and taḥsīniyyāt.

This paper identifies and clarifies the misconceptions about maqāṣid al-Sharīʿah vis-à-vis Islamic finance in the existing literature. The findings align with the views of leading maqāṣid scholars in understanding the idea.

This paper aims to investigate the extent to which maṣlaḥah (public interest) is taken into consideration in Islamic banking operations in Malaysia, particularly in bayʿ al-ʿīnah (sale and buyback), taʿwiḍ (compensation) and ibrāʾ (rebate).

This study applies deductive and inductive methods to analyze the application of maṣlaḥah in Islamic financial transactions. Three issues in Malaysia are selected as a case study, allowing bayʿ al-ʿīnah, standardizing the rate of taʿwiḍ and stipulating the ibrāʾ clause in financial agreements. As this study is qualitative in nature, all data are analyzed based on the content analysis method.

Both the maṣlaḥah of Islamic banks and their customers were found to be considered by the Central Bank of Malaysia in the implementation of contracts and principles of Islamic banking. The first maṣlaḥah represents the viability of Islamic banks, while the second maṣlaḥah promotes fairness and transparency between Islamic banks and their customers.

This study only focuses on the contracts and principles of Islamic banking operations in Malaysia with regard to three selected issues.

This paper clarifies the practical application of maṣlaḥah in the Islamic banking industry, particularly with regard to implementing its contracts and principles.

This paper analyzes the argument of maṣlaḥah on the issues of bayʿ al-ʿīnah , taʿwiḍ and ibrāʾ in Malaysia, which are considered among scholars to be debatable issues. While many discussions focus on the legal aspect of Sharīʿah on those issues, this study emphasizes how the application of maṣlaḥah aims to solve the current problems and harmonize between Sharīʿah and reality.

This paper aims to formulate a conceptual framework that will facilitate the actualization of maqāṣid al-Sharīʿah in product design and consumption within Islamic financial institutions (IFIs).

This paper relies on the classical and contemporary literature on maqāṣid al-Sharīʿah and Islamic finance and adopts a qualitative content analysis method and an inductive approach to outline the constituent elements that formulate the framework.

This study determines six vital constituents of maqāṣid al-Sharīʿah, namely, parameters of maqāṣid, particular objectives, appropriate means, micro provisions, level of need and legal maxims to develop a conceptual framework of actualizing maqāṣid al-Sharīʿah in Islamic finance. The framework covers the following three stages: identification of maqāṣid, operationalization of maqāṣid in product design and consumption based on maqāṣid.

This paper proposes a conceptual framework without investigating the practice of any particular industry or products. Further research would focus on formulating a practical framework based on a focus group discussion with industry experts, elaborating the parameters of maqāṣid, scrutinizing the maqāṣid available in the literature by the parameters of maqāṣid and assessing the IFIs’ products and services using the proposed framework.

This paper provides insights into the importance of maqāṣid elements and the effects of overlooking them on IFIs and customers’ product consumption. Furthermore, a major implication of the proposed framework is to learn how to use the maqāṣid approach as the baseline for designing new financial products.

The novelty of this paper lies in its pioneering attempt of harmonizing all essential maqāṣid elements and using them as constituents to formulate a comprehensive framework that actualizes maqāṣid al-Sharīʿah in the Islamic finance industry.

This paper aims to investigate the current mechanism of taʿwidh (compensation) from the perspective of Shariīʿah, which is used by Islamic banking in Malaysia to deal with the issue of late payment.

This study is qualitative in nature, using semi-structured interviews carried out with two types of informant – members of the National Sharīʿah Advisory Council (SAC) and the Internal Sharīʿah committee (SC) – with regard to practicing taʿwidh.

The findings reveal taʿwidh is an alternative to the interest-based late payment penalty, which is prohibited in Islam. While taʿwidh finds justification in the hadith and maʿlaʿah, in respect of sustaining the competitiveness of the Islamic banking operation, its practice is still debatable because it is determined by a special rate instead of the actual loss. This paper addresses this issue by suggesting that even though the central bank has allowed Islamic banks to regard 1 per cent as their income, they should review that amount, and claim only the actual loss. The remaining money could be used for charitable purposes, which can be conducted by Islamic banks themselves.

This study is limited because it focusses on the extent to which the current practice of taʿwidh in Malaysia has complied with Shariīʿah principles. It does not focus on gharamah (penalty), which is considered to be the second late payment penalty mechanism. Moreover, data are collected from nine interviewees from SAC and SC from different Islamic banks. Thus, the results cannot be generalised to other countries.

This paper highlights Shariīʿah concerns regarding the current application of taʿwidh. Moreover, as it uses primary data, it provides a fresh discussion of taʿwidh, from both the perspective of regulators in Malaysia and the experience of practitioners, particularly in terms of Shariīʿah compliance.

The paper aims to investigate the dimensions of maqasid al-Shari'ah in Islamic finance by exploring the ends (maqasid) and the means (wasa'il). Those would clarify the nature and goals of Islamic finance as well as its directional development.

Using literature in English and Arabic sources in the area of maqasid al-Shari'ah, as well as from the reading of the primary sources (the Qur'anic texts/nusus), the paper attempts to delineate the dimensions that would constitute the ends (maqasid) and the means (wasa'il) in Islamic finance.

The paper explicates three specific ends (maqasid) in Islamic finance, namely wealth circulation, fair and transparent financial practices and justice at the micro- and macro-level. To achieve those ends, the Shari'ah provides means (wasa'il) such as facilitating financial contracts, establishing values and standards and instituting social responsibility.

The paper is a conceptual paper that explores the dimensions of maqasid al-Shari'ah in Islamic finance.

The findings of this paper will give insights on the ends (maqasid) and the means (wasa'il) in Islamic finance based on the maqasid al-Shari'ah discourse. It could be used as a reference in understanding the nature of Islamic finance and in developing a sound and solid Islamic finance based on the Shari'ah.

The paper proposes the ends-and-means criteria in Islamic finance, developed on the basis of the maqasid al-Shari'ah discourse as well as from direct reading of the texts (nusus), which is lacking in the Islamic finance literature.

The purpose of the study is twofold: first, it is to develop each aspect of maṣlaḥah ḍarūriyah (essential needs), i.e. dīn (faith/religion), nafs (soul), ʿaql (intellect), naṣl (descendants) and mal (wealth), into various aspects of organisational essential needs; second, it is to formulate maṣlaḥah-based performance measurement.

The research is an exploratory study that uses a two-stage design: defining the research question and developing the research design. The research question is how each element of maṣlaḥah ḍarūriyah can become an element of organisational essential needs. The research design developed is to formulate maṣlaḥah-based performance measurement.

The study concludes that maṣlaḥah ḍarūriyah could be developed as a basis for identifying organisational essential needs. The five elements of maṣlaḥah ḍarūriyah are developed into the following organisational essential needs: worship orientation, internal process orientation, talent orientation, learning orientation, customer orientation and wealth orientation. Maṣlaḥah-based performance measurement uses five variables: strategic objective, measure, formula, target and strategic initiatives and applies the modified plan – do – check – action cycle: performance planning, performance implementation, performance evaluation and performance action.

Organisational essential needs can be developed by Islamic financial institutions (IFIs) into performance measurement. IFIs have six essential needs that can be developed into performance variables. Key performance indicators that can be developed for each need are worship orientation (social responsibility, regulatory compliance and Sharīʿah compliance); internal process orientation (innovation process, digital adaptation and employee satisfaction); talent orientation (career development, talent pool, compensation and benefits); learning orientation (training programme, training evaluation and return on training investment); customer orientation (customer engagement, customer satisfaction, customer survey and promotion programme); wealth orientation (profitability, cost-cutting, share prices, dividends, cost efficiency and financial sustainability).

This paper contributes to new knowledge. The study attempts to discuss the organisational essential needs based on the maṣlaḥah ḍarūriyah concept, while previous studies discussed organisational needs based on Maslow’s hierarchy of needs. In developing performance measurement, organisational performance is measured in a balanced manner. According to the concept of maṣlaḥah, not only financial factors but also worship, internal processes, talents, learning and customers define organisational needs. Thus, organisational needs are considered not only in terms of material factors but also in terms of spiritual (worship) factors.

This study aims to scrutinize the modus operandi of global financial frauds in Islamic financial institutions and assesses whether those frauds can be prevented using High Standards of Shariah Governance.

A qualitative research methodology is deployed to conduct this study by analyzing and scrutinizing academic journals, reports, regulatory guidelines and articles.

The findings in this study show that the modus operandi ranges from bribery, forged documents, unlawful profiteering, credit limit allowance ignorance, Ponzi scheme, culprit collaboration from inside and outside the banks. This paper also argues that the centralized and high-standard Shariah governance framework better prevents fraud by providing better Shariah supervision and risk management measures.

The observations in this study are limited to financial fraud at Islamic financial institutions that happened in the 21st century with more than $100m in financial loss or penalty.

This study may contribute significantly by providing insight for regulators to strengthen the Shariah governance framework in their respective countries. It also benefits Islamic financial institutions by enhancing their capacity to anticipate future financial fraud.