Beyond profit: maqasid al-Shari’ah in Islamic finance through partnership contracts (ʿUqud al-Ishtirak)

As-Salafiyah, Aisyah and Ali, Mohammad Mahbubi and Rusydiana, Aam Slamet (2025) Beyond profit: maqasid al-Shari’ah in Islamic finance through partnership contracts (ʿUqud al-Ishtirak). In: Islamic Financial Markets and Institutions: Challenges, Financial Stability, and Inclusivity. Contributions to Economics, Part F858 (1). Springer, Singapore, pp. 175-194. ISBN 978-981-96-8649-0

	PDF (Book Chapter) - Published Version Restricted to Repository staff only Download (1MB) | Request a copy
	PDF (Scopus) - Supplemental Material Download (211kB)

Abstract

Islamic finance has undergone remarkable growth over the past four decades, establishing itself as a significant sector in the global financial landscape. Rooted in Shariah principles, Islamic finance promotes justice, fairness, and public welfare through distinct mechanisms such as profit- and loss-sharing while prohibiting unethical practices like usury (riba), uncertainty (gharar), and gambling (maysir). Partnership contracts (ʿUqūd al-Ishtirāk), particularly mushārakah and muḍārabah, exemplify these principles by fostering equitable wealth distribution, cooperation, and sustainable economic development. This study explores the Shariah objectives (maqāṣid al-Sharīʿah) underpinning mushārakah and muḍārabah contracts within Islamic finance. Employing a qualitative approach, it integrates primary sources such as classical jurisprudence texts and secondary sources including academic literature. The analysis highlights the principles of risk-sharing, fairness, and justice embedded in these contracts, with a focus on their practical implementation and alignment with maqāṣid al-Sharīʿah. The paper also examines Malaysia’s pioneering efforts in promoting partnership contracts, showcasing its leadership in aligning regulatory frameworks with Shariah principles. Insights from this study are expected to guide policymakers and financial institutions in leveraging mushārakah and muḍārabah to foster inclusive, entrepreneur-friendly, and socio-economically sustainable environments. By emphasizing the maqāṣid al-Sharīʿah in partnership contracts, this research underscores their potential to contribute to a more equitable and just economic system, positioning Islamic finance as a key driver of sustainable development globally.

Item Type:	Book Chapter
Additional Information:	11477/124399
Uncontrolled Keywords:	Maqāsid al-Shari'ah, Partnership contracts, Islamic finance, ʿUqud al-Ishtirak, Musharakah, Muḍarabah
Subjects:	H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Institute of Islamic Banking & Finance (IIiBF)
Depositing User:	Dr Mohammad Mahbubi Ali
Date Deposited:	28 Nov 2025 10:52
Last Modified:	28 Nov 2025 11:03
Queue Number:	2025-11-Q215
URI:	http://irep.iium.edu.my/id/eprint/124399

Actions (login required)

View Item