The implication of agency theory in micro-business financing of sharia cooperatives in Indonesia

Martiana, Andri and Kassim, Salina and Zakariyah, Habeebullah (2023) The implication of agency theory in micro-business financing of sharia cooperatives in Indonesia. International Journal of Advanced Research in Economics and Finance, 5 (3). pp. 248-256. E-ISSN 268-812X

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Abstract

The study examines the application of agency theory to Baitul Maal wa Tamwil (BMT), an Indonesian Sharia Cooperative, in terms of asset growth and socioeconomic implications. The paper examines BMT's cooperative structure, which complicates the agency relationship and calls into question the responsibilities of agents and principals to the finance practises of BMTs in Indonesia. However, BMTs continue to encounter agency issues in their real-world situations. They can employ a variety of financing contracts, including Murabaha, Mudaraba Musharakah, and Qardh hasan, however some may have problems. According to the findings, the paradigm of thinking based on Islamic principles should be examined in the context of BMT. Further empirical research on agency difficulties at BMTs in Indonesia can be carried out with the approval of the Ministry of Cooperatives, SMEs, and Finance.

Item Type:	Article (Journal)
Uncontrolled Keywords:	implication, agency theory, baitul maal wa tamwil, sharia cooperative, agency relationship
Subjects:	H Social Sciences > HG Finance H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance H Social Sciences > HG Finance > HG3691 Credit
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Institute of Islamic Banking & Finance (IIiBF)
Depositing User:	Prof. Dr. Salina Kassim
Date Deposited:	17 Jan 2024 15:58
Last Modified:	20 Feb 2024 12:36
URI:	http://irep.iium.edu.my/id/eprint/110218

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