Potential Application of Bay'As-Salām Contract in Islamic Banking in Indonesia

MK Anwari, A Anshor - Journal of Integrated Sciences, 2021 - jis.iou.edu.gm
Journal of Integrated Sciences, 2021jis.iou.edu.gm
Islamic banking in Indonesia has developed and grown tremendously in recent times. This is
proved with the launch of various products, however they have not yet applied a form of
Islamic forward contract bay 'as-salam as a mode of financing due to it being more
susceptible to risks than the other Islamic commercial contracts used by Islamic banks in
Indonesia. This research attempts to analyze some factors as to why bay 'as-salam does not
seem attractive to the Islamic banks to implement, then to explore the theoretical possibility …
Abstract
Islamic banking in Indonesia has developed and grown tremendously in recent times. This is proved with the launch of various products, however they have not yet applied a form of Islamic forward contract bay ‘as-salam as a mode of financing due to it being more susceptible to risks than the other Islamic commercial contracts used by Islamic banks in Indonesia. This research attempts to analyze some factors as to why bay ‘as-salam does not seem attractive to the Islamic banks to implement, then to explore the theoretical possibility of its future application as well as to propose a working model. Due attention will be paid to comparision between bay’as-salām and the future of contract applications in the Islamic finance industry. The methodology approached is focused on library research and conducting interviews with Islamic bank officers. The study proposes a bay ‘as-salam model based on wakālah contract to be applied in Islamic banks in Indonesia.
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