The growth of Islamic financial institutions and banking in Muslim-majority countries may be indicative of increasing adherence of Muslims towards Islamic principles in their countries.
Islamic Saving and Loan Cooperatives or BMTs in Indonesia have undergone exceptional development. This paper investigates and provides information regarding the accountability of BMTs in Indonesia as the development of reporting regulation and accounting standards has not followed the rapid development of BMTs. Due to a lack of a supervisory board and a low demand for audited financial statements, there is little incentive for BMT managers to have independent auditors audit their financial statements. Only 7-20% of BMTs, statistics reveal, are audited by independent auditors.
During the economic adversities in Indonesia in late 1997, the SMEs (Small and Medium Enterprises) proved to be more resilient than larger companies which were tied to foreign debts and imported materials. Due to their resilience, SMEs have the potential to improve the economic landscape of Indonesia provided that they are developed well. The continued running of the SMEs depends in many ways on value chains in the business environment. Strong financial institutions or banks are needed to finance the SMEs. In Indonesia, Islamic banking is a new and promising alternative for financing SMEs.
The article discusses the characteristics of Gharzul-hasaneh loans. The allocation of incomes into consumption and savings by consumers is analyzed in the first section of the article. Alternative methods of saving like gharzul-hasaneh savings, charity donations and long term investments are then discussed. The functioning and performance of Gharzul-Hasaneh Funds (GHF) in the urban and rural sectors of Iran is explored in the third section.
MMEs can decrease partnership when acquiring assets and financing complete ventures as suggested by contemporary scholars. Increasing emphasis on equity participation will allow ancillary contracts of ijarah and sale to function independently. Instead of focusing on the calculation of the profit from the capital outlay, the realistic pricing of ijarah rentals and the units should be emphasized as the reality of the underlying contracts. Expenses of the business should be proportionally shared in businesses that are financed on decreasing partnership.
The paper explores the relationship between the success of an entrepreneur and the success of his/her business. A survey of
Mudaraba financing in Indonesian Rural Shari‘a banks gives rise to many agency problems. The project attributes and the Mudaribs’ attributes that are financed by the banks under consideration are investigated in the study.
The paper discusses the economic condition of the peasants in Indonesia in detail and their eligibility for
Even though the majority of the Muslims in South Africa do not live below the poverty line, they still have a duty to help the poor.
The murabahah mode of financing as an Islamic instrument and contract for MMEs (Micro and Medium sized enterprises) in the working of Baitul Mal Wattamwil (BMT), Yogyakarta, Indonesia is investigated in this study. BMT is a unique Islamic micro finance institution. The practice of murabahah financing products, its procedures and its applications in the BMTs in the light of shari’a rules is examined.