Bridging Theory and Practice: Hybrid Contracts in Islamic Pawnbroking and DSN-MUI Fatwas

DOI

10.2991/978-94-6463-938-4_37How to use a DOI?

Keywords

Fatwa DSN-MUI; Hybrid Contract; Islamic Pawnbroking

Abstract

The necessity for studies on Islamic pawnbroking is evident in the pursuit of understanding the Islamic economy and finance as a potential alternative for communities seeking access to capital and other resources. The present study focuses on the analysis of the conformity of contract practices in Islamic pawnbroking institutions with the fatwa of the National Sharia Council of the Majelis Ulama Indonesia (DSN-MUI) with a hybrid contract approach. The research method employed is the normative juridical method, which involves examining the application of Islamic legal principles at two different levels: the methodological level (ushul fiqh) and the level of fiqh rules and products (fiqh). The primary data for this research are DSN-MUI fatwas, documents on pawnbroking agreements in Islamic Financial Institutions, and interviews with management in the Islamic pawnbroking industry. The findings indicate that the practice of pawnbroking in Islamic financial institutions is not in violation of the DSN-MUI fatwa. However, Islamic financial institutions require adjustments to their operational implementation. This has given rise to novel terms such as mu’nah contract administration, mu’nah discount, and tearing mu’nah, which are not explicitly regulated in the DSN-MUI fatwa. This study recommends that the provisions concerning mu’nah contract administration, mu’nah discount, and the concept of tearing in determining mu’nah should be incorporated into the DSN-MUI fatwa.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Download article (PDF)

TY  - CONF
AU  - Dede Abdul Fatah
AU  - Inas Afifah Zahra
PY  - 2025
DA  - 2025/12/31
TI  - Bridging Theory and Practice: Hybrid Contracts in Islamic Pawnbroking and DSN-MUI Fatwas
BT  - Proceedings of the International Conference on Applied Science and Technology on Social Science 2025 (iCAST-SS 2025
PB  - Atlantis Press
SP  - 315
EP  - 322
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-938-4_37
DO  - 10.2991/978-94-6463-938-4_37
ID  - Fatah2025
ER  -