Islamic Non-bank Financial
Institution in Indonesia
By:
Prof. Dr. EUIS AMALIA M.Ag
Professor of Islamic Economics in UIN Syarif Hidayatullah Jakarta
29th December 2022
Definition of Islamic Non-bank Financial
Industry
Islamic Non-bank Financial Industry (IKNB Syariah) is a field of activity related to
activities in the insurance industry, pension funds, financing institutions, and other
financial service institutions, which must be implemented according to sharia
principles. In general, its activities are no different from conventional IKNB.
However, there are some special characteristics, with products and transaction
mechanisms based on sharia principles.
Prof. Dr. Euis Amalia, M.Ag
Regulation of IKNB Syariah
IKNB syariah has guidelines in carrying out its duties. These guidelines have been regulated in government regulations, OJK
regulations and DSN MUI fatwas made by regulatory agencies such as Bapepam, OJK, and the MUI National Sharia Council.
Prof. Dr. Euis Amalia, M.Ag
Type of IKNB Syariah
Prof. Dr. Euis Amalia, M.Ag
Sharia Insurance
Sharia insurance is an attempt to protect and help each other among a number of
people/parties through investment in assets and which provides a pattern of
returns to deal with certain risks through contracts that are in accordance with
sharia principles.
Islamic insurance uses the principle of sharing of risk, in which the risk from one
person/party is borne by all people/parties who are policyholders, while
conventional insurance uses a transfer of risk system in which the risk from the
policyholder is transferred to the insurance company.
Prof. Dr. Euis Amalia, M.Ag
Akad in Sharia Insurance
Risk
Insurance
Participant
Pool of
Tabarru’
Fund
Surplus/Defisit Underlying
Insurance
Participant
Sharia Insurance
Company
Insurance
Participant
Investi
The contract ( Akad’) used in sharia insurance uses the principle of mutual help between fellow policyholders and the
policyholder's representative/cooperation with the sharia insurance company, while the contract used by conventional
insurance is based on the principle of exchange (buy-sell).
Prof. Dr. Euis Amalia, M.Ag
Sharia Insurance
Product
Advantange of
Sharia Insurance
In general, these insurance products can be grouped as
There are several advantages to the sharia
follows:
insurance system:
1. Sharia insurance products that provide benefits in the
1. Fund management uses sharia principles
form of compensation or compensation in the event
of a disaster, such as death, illness, accident, damage
and/or loss of property.
2. An
insurance
benefits
in
participant
product
the
dies
form
and
that
of
provides
insurance
compensation
benefits
in
the
if
the
form
of
investment returns. In this product, some of the
2.
Transparency
of
fund
management
policyholders
3.
Distribution
of
profits
from
fund
management
4. Ownership of funds
5. Forfeited fund system does not apply
6. There is an allocation and distribution of
underwriting surplus
contributions or premiums paid by participants will be
allocated to the tabarru' fund and the other part will
be allocated to the participants' investment.
to
Prof. Dr. Euis Amalia, M.Ag
Sharia Insurance
scheme
Prof. Dr. Euis Amalia, M.Ag
Sharia Pension Fund
Islamic Pension Funds are Islamic financial institutions that have the
characteristics to be able to be used in order to maintain the continuity of one's
income when entering retirement.
The difference between conventional and sharia pension funds, of course, lies in
the principles used. Islamic pension funds use sharia contracts in their operational
activities, such as using contracts when they become participants or paying
contributions. In addition, sharia pension funds also pay close attention to sharia
principles, such as not containing elements of maisir, gharar and riba.
Prof. Dr. Euis Amalia, M.Ag
Pension Fund
scheme
Based on the scheme, Islamic pension funds involve
four main parties, namely employers (wahib),
investees,
participants
(mauhub
lah),
and
retirees/heirs. Hibah Bi syarth akad and hibah
muqayyadah are akad used by employers to
participants in terms of payment of pension
contributions. In the context of delegation of power
activities with fees/fees to third parties, a wakalah bil
ujrah or mudharabah akad is used, but if a pension
fund uses a third party, the pension fund can use an
ijarah akad.
Prof. Dr. Euis Amalia, M.Ag
Pension Fund Product
As with conventional pension funds, Islamic pension funds consist of two types, namely Employer Pension Funds
(DPPK) and Financial Institution Pension Funds (DPLK):
Employer Pension Fund (DPPK) is a pension fund
set up by a person or entity that employs employees,
as the founder, to administer a defined benefit or
defined contribution pension program for the benefit
of some or all of its employees as participants, and
which incurs obligations to the participants.
Financial Institution Pension Fund (DPLK) is a
pension fund set up by a bank or life insurance
company to organize a defined contribution pension
program for individuals, both employees and selfemployed workers, which is separate from the DPPK
for employees of the bank or life insurance company
concerned.
Prof. Dr. Euis Amalia, M.Ag
Sharia Financing Institution
In general, a Sharia Financing Company (PP Syariah) is a finance company that in
carrying out its business activities (only disbursing financing/funding to the public)
is based on or in accordance with sharia contract principles.
In the organizational structure of PP Syariah management, there is a Sharia
Supervisory Board (DPS) whose function is to ensure that Sharia principles are
implemented better and properly.
Prof. Dr. Euis Amalia, M.Ag
Regulation of Sharia Financing
Institution
POJK Number 31/POJK.05/2014 concerning the Implementation of Sharia Financing
Businesses also regulates the business activities of Sharia Financing Companies, namely:
1. Sale and Purchase Financing, namely financing in the form of supply of goods through
sale and purchase transactions in accordance with the sharia financing agreement
agreed by the parties;
2. Investment Financing, namely financing in the form of provision of capital within a
certain period of time for productive business activities with profit sharing in
accordance with the sharia financing agreement agreed upon by the parties;
3. Service Financing, namely the provision/provision of services either in the form of
providing benefits for an item, providing loans (bailout funds) and/or providing services
with and/or without payment of fees (ujrah) in accordance with the sharia financing
agreement agreed upon by the parties.
4. Other sharia financing business activities in accordance with OJK approval.
Prof. Dr. Euis Amalia, M.Ag
Business Model in Sharia Financing
Institution
The business model used by PP Syariah to start a
business is obtained from shareholders. In
developing its business and increasing its assets,
PP Syariah uses funds from Islamic banks.
Meanwhile, sellers in this context are parties that
support finance companies in the availability of
goods/services that will be financed by finance
companies such as dealers, suppliers, and others.
In addition, other financial services industries
such as sharia insurance also support PP Syariah
as a guarantee party.
Prof. Dr. Euis Amalia, M.Ag
Akad in Sharia Financing Institution
In addition, there are various types of contracts used in sharia financing in accordance
with the business activities carried out. However, there are several contracts that are
commonly known in Islamic financing, including:
1. Murabahah, namely the contract of sale and purchase of an item by confirming
the purchase price (acquisition price) to the buyer and the buyer pays it at a
higher price (margin) as profit in accordance with the agreement of the parties;
2. Mudharabah, namely a business cooperation contract between two parties in
which the first party (shahib mal) provides all the capital, while the second party
(mudharib) acts as manager, and business profits between them are in accordance
with the agreement of the parties;
3. Ijarah, namely the contract of transferring use rights (benefits) of an item for a
certain period of time with payment of rent (ujrah), without being followed by the
transfer of ownership of the item itself.
Prof. Dr. Euis Amalia, M.Ag
Lembaga Keuangan Syariah Khusus
Special Islamic Financial Institutions are institutions that carry out specific tasks and
functions to support government programs. Here are some specialized Islamic financial
institutions:
1. Lembaga Pembiayaan Ekspor Indonesia,
2. Perusahaan Pergadaian, Lembaga Penjamin
3. Perusahaan Pembiayaan Sekunder Perumahan
4. PT Permodalan Nasional Madani (Persero) ,
5. PT Danareksa (Persero).
Prof. Dr. Euis Amalia, M.Ag
Sharia Micro Finance Institution
Islamic Microfinance Institutions are financial institutions specifically established
to provide business development services and community empowerment, either
through loans or financing in micro-scale businesses to members and the public,
managing deposits, as well as providing business development consulting services
that are not solely for profit.
Islamic microfinance or sharia microfinance is one of the Islamic approaches to
tackling poverty, because poverty is contrary to maqashid sharia.
Prof. Dr. Euis Amalia, M.Ag
Baitul Maal Concept Sharia Micro
Finance Institution
In the context of Islamic economics, the concept of BMT is a form of application of Islamic
economics. The concept of BMT is designed as a socio-economic institution. By using
resources including commercial funds or capital as well as social funds (zakat, infaq, shadaqo’,
and waqf) from the community which are then managed and utilized for the local community
itself.
The concept of BMT emphasizes the concept of a people's socio-economic institution, which
conceptually and actually focuses more on the lower class, near-poor, poor to the poorest of
the poor through capital assistance and empowerment to improve economic, social and
spiritual.
Prof. Dr. Euis Amalia, M.Ag
Sharia Financial Technology
Financial Technology is a financial service to bring together lenders and
borrowers in the context of entering into loan agreements in the rupiah
currency directly through an electronic system.
This type of fintech does have various sectors from: payment, lending,
aggregator, crowdfunding, personal or financial planning. the distribution
sector of Islamic fintech is still the same, not much different from
conventional fintech. Fintech Syariah means financial services and solutions
provided by technology companies or fintech startups based on Islamic laws
(sharia). However, the regulations required by sharia fintech are also from
the National Sharia Council - Indonesian Ulema Council.
Prof. Dr. Euis Amalia, M.Ag
Sharia Financial Technology
In the Fatwa of the National Sharia Council (DSNMUI) number 117 of 2018 Information TechnologyBased Financing Services Based on Sharia
Principles is the provision of financial services
based on sharia principles that bring together or
connect Financiers with Financing Recipients in
the context of conducting financing agreements
through an electronic system using a network
Internet. Information Technology-Based Financing
Services are permitted subject to conditions in
accordance
with
sharia
principles.
The
implementation of information technology-based
financing services must not conflict with Sharia
principles, namely avoiding riba, gharar, maysir,
tadlis, dharar, zhulm, and haram.
Prof. Dr. Euis Amalia, M.Ag
IKNB Growth in Indonesia
Based on the 2021 Indonesian Islamic Finance Development Report, Indonesia's total Islamic financial assets in 2021 will
be IDR 2,050.44 trillion and the portion of Islamic IKNB assets from the total assets is 5.90%. As of 2021, the total assets
of the sharia IKNB reach IDR 120.883 billion with an asset growth of 3.90% (yoy).
Prof. Dr. Euis Amalia, M.Ag
IKNB Growth in Indonesia
IKNB Syariah plays an important role in
supporting the development of the MSME
industry. The support provided by IKNB
Syariah includes providing working capital,
providing protection services through
sharia insurance, investment and financing
services
by
sharia
microfinance
institutions, and business development
through sharia fintech. the development of
Sharia IKNB will drive the pace of economic
growth, and vice versa economic growth
will increase demand for the Islamic IKNB
financial sector. Besides that, Sharia IKNB
is proven to have a long-term relationship
with economic growth in Indonesia.
Prof. Dr. Euis Amalia, M.Ag