Suharto, Ugi,(2018), Riba and interest in Islamic finance: semantic and terminological ıssue. , International Journal of Islamic and Middle Eastern Finance and Management, UNSPECIFIED
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Abstract
Purpose – The aim of this paper is to argue analytically that interest and riba are not exactly the same and
not an interchangeable terminology. There are imilarities and differences between the two at the conceptual level.
Design/methodology/approach – To support the argument, the paper shows that it is possible to prove cases where the riba is involved but the interest is not. Hence, there is a situation of the presence of riba without interest. Furthermore, it is also possible to prove cases where the interest is involved but the riba is not. Hence, there is a situation of the presence of interest without riba. The notion and concept of interest in
finance are analysed critically in comparison with riba in Islamic jurisprudence (fiqh Islami). So a comparative
conceptual analysis is the main methodology of the paper.
Findings – The paper finally suggests that the correct expression should be that Islamic banking and finance is “a ribawi free of banking and finance” instead of "interest free of banking and finance” as it is
popularised.
Research limitations/implications – The paper is conceptual in nature. No empirical analysis is
pursued.
Practical implications – Islamic finance should not claim it self as interest-free finance, rather riba-free finance.
Social implications – It is more truthful to the society to say that Islamic finance is riba-free finance.
Originality/value – The paper is expected to contribute in the conceptual level of Islamic banking and finance’s understanding by clearing up the basic confusion and misconception about riba and interest. This would consequently minimise or even eliminate the taken-for-granted tendency of denoting the semantic of riba and interest as an interchangeable term, especially when writing in English and addressing the finance’s students and scholars. The semantic clarification between interest and riba hopefully becomes the main contribution of this paper.
Keywords : | Interest-free banking, Future value, Interest-riba, Islamic jurisprudende, Present value, Time value of money, UNSPECIFIED |
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Journal or Publication Title: | International Journal of Islamic and Middle Eastern Finance and Management |
Volume: | 11 |
Number: | 1 |
Item Type: | Article |
Subjects: | Ekonomi Islam |
Depositing User: | Heru Prastyo |
Date Deposited: | 16 Dec 2019 07:42 |
Last Modified: | 16 Dec 2019 07:42 |
URI: | https://repofeb.undip.ac.id/id/eprint/233 |