Research on Bba and Its Application in Malaysia
Abstract
This study reviewed the application of BBA in Malaysia. BBA or known as Al-Bai’ Bithaman Ajil is a financing facility that is based on a sale plus profit. It is commonly used by bank in Malaysia because it replaced the non-halal element in the conventional loan. However, there are some claims that the operation is not done correctly. Users especially the Muslims still doubt on its legality. Thus, bank officers were tested on how their bank operates it. The result exposed that the claim is not true. It is recommended that there should be future research on how the information should be exposed to the public.
Keywords: Bai’ Bithamin Ajil, Islamic banking.
Introduction | 4 | Literature Review | 4 | Methodology | 6 | Findings | 6 | Discussion | 11 | ConclusionReferences | 1213 |
Introduction Bai’ bithaman ajil is a financing instrument that derived from an equation of sale plus profit. Most Islamic banks in Malaysia are using this concept for their customers on various commodities such as; houses, cars, land and personal financing. BBA is a substitute product for conventional loan which is believed to have impermissible element.
The issue that really caught the attention of the writer for doing this research is people are still claiming that the principle of BBA is not correctly applied by the bank. It is said that this transaction involves interest (riba). As a solution, survey will be conducted and questionnaires will be distributed to the bank staff as well as its users.
The purpose of the study would be to ascertain how islamically is the application of BBA and to examine ways on how to educate the users about the true concept of BBA. The research questions have been set up as follows; * Do the bankers exactly know about the principle of BBA? * How BBA is being applied in banking system?
Since this research is on the Islamic Financing product, some Islamic term has been introduced. BBA is normally defined as
This study reviewed the application of BBA in Malaysia. BBA or known as Al-Bai’ Bithaman Ajil is a financing facility that is based on a sale plus profit. It is commonly used by bank in Malaysia because it replaced the non-halal element in the conventional loan. However, there are some claims that the operation is not done correctly. Users especially the Muslims still doubt on its legality. Thus, bank officers were tested on how their bank operates it. The result exposed that the claim is not true. It is recommended that there should be future research on how the information should be exposed to the public.
Keywords: Bai’ Bithamin Ajil, Islamic banking.
Introduction | 4 | Literature Review | 4 | Methodology | 6 | Findings | 6 | Discussion | 11 | ConclusionReferences | 1213 |
Introduction Bai’ bithaman ajil is a financing instrument that derived from an equation of sale plus profit. Most Islamic banks in Malaysia are using this concept for their customers on various commodities such as; houses, cars, land and personal financing. BBA is a substitute product for conventional loan which is believed to have impermissible element.
The issue that really caught the attention of the writer for doing this research is people are still claiming that the principle of BBA is not correctly applied by the bank. It is said that this transaction involves interest (riba). As a solution, survey will be conducted and questionnaires will be distributed to the bank staff as well as its users.
The purpose of the study would be to ascertain how islamically is the application of BBA and to examine ways on how to educate the users about the true concept of BBA. The research questions have been set up as follows; * Do the bankers exactly know about the principle of BBA? * How BBA is being applied in banking system?
Since this research is on the Islamic Financing product, some Islamic term has been introduced. BBA is normally defined as