53 research outputs found

    Social synergy sukuk (Double-S Sukuk): a solution for pandemic crisis

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    The COVID-19 pandemic crisis is projected to plunge over half a billion people (580 million) globally into extreme poverty. This exploratory paper proposes an innovative Social Synergy Sukuk (Double-S Sukuk) for alleviating the alarming upsurge in extreme poverty triggered by the pandemic in the face of limited resources. The Double-S Sukuk is designed with Multilateral Development Banks (MDBs); such as Islamic Development Bank subscribing to the Sukuk at a discounted profit rate, issued by a country facing the pains of the pandemic. The profit will be paid by a charitable Non-Governmental Organization; such as Bill & Melinda Gates Foundation as an incentive to the crisis country contingent upon judicious utilization of the funds for the pre-agreed social targets achieved within timely milestones that trickle down to uplift the citizens from the pandemic pains of extreme poverty. The country will only pay the principal component. Furthermore, a suitable MDB; such as Multilateral Investment Guarantee Agency (MIGA) will issue a charitable guarantee to enhance the Sukuk rating and cut issuance costs. This enhancement makes the Sukuk an attractive BASEL III High-quality-liquid-asset (HQLA). Instead of begging the public for charity, the Double-S Sukuk will be open to the public to invest alongside MDBs for a discounted profit rate to crowd in the social/ethical conscious private sector to raise cheaper and larger funds for an apt synergistic crisis alleviation. The methodology used in this study is qualitatively based on content analysis of relevant academic journals, industry reports, and policy documents

    The level of acceptance and awareness of takaful in Nigeria

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    This study investigates the factors determining consumers’ acceptance of takaful (Islamic insurance) in Nigeria. The main objective is to explore the Shariah view, price, service quality, attitude, awareness, subjective norm, and perceived behavior control of Nigerian citizens towards the acceptance of takaful services in the country. One of the obstacles currently facing the takaful industry in Nigeria is the lack of awareness about takaful products. To examine the acceptance and awareness of takaful in Nigeria, 209 questionnaires were distributed to respondents in five states, including Lagos, Abuja, Kano, Kaduna, and Enugu; and the data collected were analyzed using SPSS, version 25. The results show that Shariah view, locality, consumer acceptance, service quality, attitude, awareness, subjective norm, and perceived behavior control are the factors influencing the awareness and acceptance level of takaful in Nigeria. The implication of this study is that the majority of respondents do not possess sufficient information to differentiate between conventional and Islamic insurance. As such, for proper implementation and development of takaful in Nigeria, it is important for the policymakers and other stakeholders to provide enough information about the takaful services, products, and operating system to the general public. The future of takaful industry in the country will be determined by a proper understanding of the operating system and the rights of participants as well as other stakeholders, including customers and insurance regulatory bodie

    دور المشتقات المالية في إدارة مخاطر لدى المؤسسات المالية الإسلامية The role of Islamic Derivatives on Risk management in Islamic Financial Institutions

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    تطور المعاملات في المؤسسات المالية يؤدي إلى زيادة الاحتياجات في العقود الجديدة المتنوعة. أ ون تطوير المعاملات تخلق مخاطر جديدة التي يجب إدارتها بأدوات جديدة أيضا، مثل المشتقات المالية. فتناقش هذه الدراسة استخدام المشتقات المالية في السوق، خاصة كأداة التحوط لإدارة المخاطر، وكيفية استخدامها في المؤسسات المالية الإسلامية. بعد استخدام المنهج التحليلي بمطالعة الكتب والأبحاث المتعلقة بالمشتقات المالية والنظر إلى تطبيقاتها المعاصرة من المنظور الإسلامي، خلصت هذه الدراسة إلى أن المعاملات المشتقة واستخداماتها في الأسواق التقليدية لا يزال لديها العديد من المشاكل الشرعية مثل الربا وال غر رر والميسر. وتستخدم المؤسسات المالية الإسلامية المشتقات المالية الإسلامية القائمة على العقود الإسلامية توافق الشريعة كالوعد والم واعدة والمرابحة، وتستخدمها لإدارة المخاطر وليس للمضاربة الربحية. وا لمشتقات المالية الإسلامية كمنتج للهندسة المالية أن يمكن أن تتطور لتفعيل استخدامها في المستقبل

    Expanding the financial inclusion frontiers: an assessment of the roles of Developing Eight (D-8) countries financial regulators

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    This study’s objective is to embark on an exploratory study to compare the roles played by the several regulators of each of the D-8 countries towards engendering financial inclusion through the Islamic finance offerings in their domain and lessons that can be deduced by their counterparts for adoption and implementation. The study relies on secondary data sourced from official publications, working papers, articles, e-books, websites, and online resources on how the roles played by the financial regulators of the D-8 countries impact financial inclusion. Content analysis was carried out on the collated data to determine the status of each of the D-8 countries. The study found that while the regulators of some D-8 member countries had maximized the Islamic social finance offerings to combat financial exclusion within their domain, other regulators are yet to maximize the same due to factors that include weak political and or administrative will, social peculiarities among others. The study concludes by recommending the adoption of the Islamic social finance instruments in climes where the same has yet to be implemented or fully adopted, to shore up the shortfalls of government expenditure, more appositely in this era of shrinking public expenditure and post Covid-19 that has exacerbated the predicament of the financially excluded

    Protecting the interest of profit-sharing investment account holders in Islamic banks: the Nigerian experience

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    Islamic banks (IBs) have three major sources of funds namely: shareholders' funds, transaction deposits and Mudaraba deposits (by profit-sharing investment account holders-PSIAHs). Shareholders have their interest protected by the IBs’ directors, transactional accounts deposits are guaranteed by the banks. PSIAHs on the other hand have no representation on the banks’ board and their funds are not guaranteed. They rely on the goodwill of the banks’ board of directors and management to protect their interest and share profit (if any) from the investment of their funds and could lose some or all their capital if the banks incur losses. This could give rise to moral hazard and agency problem which put the PSIAHs at a disadvantage that calls for the establishment of corporate governance policies to protect their interest. The objective of this paper is to review corporate governance issues in the management of PSIAHs by IBs and to share Nigeria’s experience in the protection of the interest of PSIAHs. It is expected that the Nigerian experience could be a learning point for regulatory and supervisory authorities in other jurisdictions to replicate. The paper contributes to literature on the deposit practices by IBs which has been reported to be scarce

    Measuring the customer’s perception of the use of financial technology in Algerian Islamic Banks

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    Financial technology has emerged as one of the main factors that changed the way the financial and banking industry works, and its use has been enhanced in the financial industry around the world, stemming from the increasing spread of innovative banking services that are characterized by high efficiency and low costs. Particularly for the sizable portion of society that does not interact with the banking system, financial technology has the potential to transform the structure of financial services and make them faster, less expensive, and safer. The hypothesis model is based on technology acceptance model (TAM). The methodology in this study includes data collection through questionnaires distributed to the users of financial technology, and the sample included the users and nonusers of mobile financial services. Structural equation modeling is utilized for data analysis procedures when using survey data gathered from 300 customers who have access to financial technology services in Algerian Islamic banks. The objective of this study is to determine the factors (including perceived usefulness, perceived ease of use, per-ceived risk, trust, convenience, and social image) influencing user intention to use financial technology services in Algerian Islamic banks. The implications of this research help to determine the right strategy to know the customers’ perceptions and the factors influencing their choice of using mobile banking services. This study can be extended to future studies that include Islamic banks and conventional banks in Algeria. The study is in progress

    The impact of zakat distribution on social welfare a case study of Selangor zakat agencies, Malaysia

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    This study empirically examines the effectiveness of yearly zakāt distribution as an instrument for social welfare in the state of Selangor, Malaysia. The study applied the autoregressive distributed lag (ARDL) approach to examine these relationships over the period from 2010 to 2018. Overall, the study found that the zakāt distribution contributes significantly to social welfare through education at a significance level of 5% and contributes inadequately through income level at 10% level of significance. This indicates that the current zakāt distribution system in Selangor provides only a marginal influence on increasing the income of the poor. Furthermore, the zakāt distribution was statistically insignificant to social welfare through healthcare. These findings suggest that the current distribution channels of health are insufficient to improve social welfare and should be improved by offering social health insurance policy for zakāt beneficiaries. This can be done via ratification insurance plan between zakāt agencies and insurance companies to cover the basic health needs for zakāt recipients

    Effect of applying Total Quality Management in improving the performance of Al-Waqf of Albr Societies in Saudi Arabia: a theoretical framework for "Deming's Model = أثر تطبيق إدارة الجودة الشاملة في تحسين أداء أوقاف جمعيات البر في المملكة العربية السعودية: إطارا نظريا لتطبيق نموزذج "ديمنج"

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    This study aims to examine the effect of applying Total Quality Management (TQM) on improving the performance of the management of Al-Waqf of Alba societies in the Kingdom of Saudi Arabia through the optimal application of Deming's 14 Points on quality management. The research problem lies in the weakness of the outputs of Alba societies in terms of quality and productivity due to the lack of monitoring and control over those in charge of managing these charities. The researcher is going to use descriptive qualitative, interviews, and the case study approach to achieve the research's objectives. After an intensive review of the literature, this study confirmed the research gap and lack of empirical studies in implementing the TQM in charity organizations precisely in Saudi Arabia

    The role of zakat during pandemic crisis and post recovery (maqāsid al-sharīʽah perspective)

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    The Covid-19 pandemic suddenly claimed its existence with thousands of fatalities reported worldwide in just a few months. It has caused great concern and panic resulting to total halt in all activities particularly the economic sector. The lockdown has caused global economic contraction which has led to forecasted economic recession for the year 2020. Islamic social financing sees this phenomenon as an increase in the numbers of the needy and something has to be done. In Islamic social financing certain instruments have been identified as tools to mitigate the turmoil facing people who are badly affected by the pandemic. Zakat, sadaqah, qard al-hasan and infaq can play significant roles especially in providing financial aids to the needy. Zakat in particular has the potential to ease the financial situations for its huge collection recorded. This study employed the document analysis approach to examine the possible role zakat can play during and after the turbulence caused by the pandemic. The findings from the analyses revealed that Islamic social financing via its instruments like zakat, sadaqah, infaq and qard al-hasan are able to offer and provide financial assistance during and post crisis, in this case the Covid-19 pandemic in various sectors like the education, social and humanitarian as well as in the medical sector. The responsible party should continue to provide efficient and hassle free channel for zakat payers to continue paying zakat as it does help in providing sufficient funds and also eradicate poverty in a community that may be caused by any crises alike. The effective and efficient distribution programs are also equally important in ensuring the objective of zakat is achieved in helping the needy
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