Maqasid al-Shari’ah in Islamic finance: Harmonizing theory and reality

Muhammad Shahrul Ifwat Ishak; Nur Syahirah Mohammad Nasir

doi:10.33102/jmifr.v18i1.334

Authors

Muhammad Shahrul Ifwat Ishak Faculty of Business and Management, Universiti Sultan Zainal Abidin, Gong Badak Campus, 21300 Kuala Nerus, Terengganu Darul Iman, Malaysia
Nur Syahirah Mohammad Nasir Centre for Fundamental Studies, Universiti Sultan Zainal Abidin, Kampus Gong Badak, 21300 Kuala Nerus, Terengganu Darul Iman, Malaysia

DOI:

https://doi.org/10.33102/jmifr.v18i1.334

Keywords:

Islamic finance, Islamic banking, maslahah, maqasid al-Shari’ah, ibra’

Abstract

This paper aims to clarify how maqaṣid al-Shari’ah (objective of Shariah law) plays its role in Islamic finance, particularly in creating a harmony between Shariah rulings in theory and their application in current circumstances. Based on library research, this study applies inductive approach and descriptive method in analysing various literatures. The finding reveals that the roles of maqasid al-Shari’ah are identified as the following: harmonizing between the text of revelation and the actual situation; considering unusual circumstances and overcoming current issues. All of them reflect how maqasid al-Shariah could pragmatically adapt Shariah rulings into the real operation of Islamic finance. Since this paper comes up with two cases: replicating conventional products to be Islamic ones and implementing floating rate in Islamic prices, it provides a practical discussion on this topic.

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Author Biographies

Muhammad Shahrul Ifwat Ishak, Faculty of Business and Management, Universiti Sultan Zainal Abidin, Gong Badak Campus, 21300 Kuala Nerus, Terengganu Darul Iman, Malaysia

Nur Syahirah Mohammad Nasir, Centre for Fundamental Studies, Universiti Sultan Zainal Abidin, Kampus Gong Badak, 21300 Kuala Nerus, Terengganu Darul Iman, Malaysia

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