The Revival of Mudharabah Contract: Proposed Innovative Solutions
Journal Title: International Journal of Academic Research in Business and Social Sciences - Year 2018, Vol 8, Issue 10
Abstract
The repulsion of mudharabah (Islamic profit sharing) concept surfaces more obviously than before particularly in the banking sector. As a consequence, the product become less attractive and could be scrapped off from the banking services which eventually give negative image to the Islamic principles claimed as the way of life. While the banking sector may not be a fertile soil for mudharabah to bloom, a real business relationship context between investors and entrepreneurs is believed to be the future home for pure (non-engineered) mudharabah to recognise its real benefits. We believe that to realise the mudharabah’s true potentials, among others, the contract needs to be revived. The purpose of this study is to propose solutions in reviving the mudharabah contract between the sahibul mal (investor) and the mudharib (entrepreneur). The research methods used in this study were content analysis of the current contract guideline and in-depth interview of five different stakeholders; investor, entrepreneur, Shariah advisor, academician and lawyer. As a result, the new framework, clauses and format were recommended to revive the mudharabah contract to include procedures to prevent anticipated problems and to preserve the agreement based on Shariah as well as to encourage venturing into high profitability potential business. This proposed solution could serve as an innovative and comprehensive template for future mudharabah contract that seem to be more understandable, implementable and has substance over form. The revived contract template may also be used to convince the interested parties to have more faith on pure mudharabah benefits.
Authors and Affiliations
Siti Nurzahira Che Tahrim, Mohd Syakir Mohd Rosdi, Mohd Zulkifli Muhammad, Mohd Nor Hakimin Yusoff, Azizah Musa, Noormariana Mohd Din
Keywords
Related Articles
- EP ID EP571511
- DOI 10.6007/IJARBSS/v8-i10/4723
- Views 70
- Downloads 0
Quality of Life (QoL) of Fishermen in the West Coast States of Peninsular Malaysia
This study aims to identify factors contributing to the quality of life (QoL) of the fishing community on the West Coast States of Peninsular Malaysia namely Selangor, Perak, Kedah and Johor. It also aims to determine ch...
Impact of Supervisor Support on Job Satisfaction: A Moderating role of Fairness Perception
Supervisor support plays a substantial role in increasing employee job satisfaction. The aims of this conceptual paper is to provide a theoretical rationale of: a) direct impact of supervisor support on job satisfaction;...
Islamic Corporate Governance In Islamic Financial Institutions
From the previous literature, Islamic corporate governance is not something new and was brought into attention by Prophet Muhammad S.A.W., and mentioned in Al-Qur’an and Al-Sunnah. It is rife with principles concerning T...
Freedom of Speech in Islam and its Connection with Street Demonstrations
Freedom of expression is a right that belongs to every individual in expressing their views. In Islam, every Muslim was given the freedom and rights to defend their rights. Most of the Muslim community considers demonstr...
The Influence of Strategic Agility & Tackling Competitive Challenges toward Improving Performance among Jordanian Pharmaceutical Companies
The study has aimed To investigate the influence of four Business Scorecard Model elements in the strategic management of Jordanian pharmaceutical organizations and to develop a strategic agility model and build its asso...