3. AICIF is organized by Faculty of Economics - Sultan Agung Islamic University (UNISSULA), Faculty of Islamic Economics and Business - Sunan Kalijaga State Islamic University Yogyakarta (UIN Yogyakarta) and Institute of Islamic Banking and Finance - International Islamic University of Malaysia. The purpose of the conference is to discuss "The Role of Zakah and Islamic Financial Institutions in Poverty Alleviation and Economic Security". In the context of the recent economy, Islamic financial institutions as an economic pillar continue to hamper efforts to reduce poverty.
The role of relational capital in increasing the collection and distribution of Zakah to eradicate poverty in Central Java. Determinants of the Factors Causing Abandoned Housing Projects: A Study of Home Buyers of Islamic Housing Finance in Malaysia. Legal and Regulatory Framework for Islamic Banking in Libya - Regulatory Authority, Islamic Banking Licensing, Sharia.
Improving financial education for the poor at the bottom of the pyramid: the role of social finance versus financial. Financial Consumer Protection: An Exploratory Study on Islamic Financial Services Act 2013 (IFSA), Bnm Regulations and other applicable statutes. The role of Islamic work ethics, spiritual leadership and organizational culture towards attitude about change with.
The Impact of Bank Soundness Using Risk Based Banking Rating Method on Financial Performance of Islamic Banks Shintya Dewi Adi Putri.
INTRODUCTION
In the current monetary system, stable and fair economic is never realized by fiat money, instead the performance fiat money is more slipped. The study revealed that gold system has several advantages, such as stability, fair, practical, and the system is in line with the Islamic principles on muamalah. Some supporters of fiat money have argued that the problems cannot be addressed to the fiat system, but the management monetary system is the biggest problem.
In addition, supporters of the fiat system also argue that fiat money is also in line with Islam. In Islam there is no specific mention of money, any good will be like money if these goods are accepted by people democratically. This article briefly discusses various types of gold as money, currency and medium of exchange that have been implemented or proposed. Then it will be evaluated from the Islamic view, especially usury (riba), uncertainty (gharar) and gambling (maysir). that justice and fairness will be used as standards.
RESEARCH OBJECTIVES AND METHODS
SOME MODELS OF THE GOLD AS MONEY AND PAYMENT SYSTEM
- Gold Dinar Physicaly as Money
- Gold Dinar in the Domestic Transactions
- Gold Dinar in the Bilateral Payments Arrangement (BPA) and the Multilateral Payment Agreement (MPA)
- Gold and Silver as Complementary Currency
- The Design of Mobile Payment System Based on Gold
A mint that launched the Islamic gold dinar and Islamic silver dirham for the UAE market since November 7, 2001. This system is operated by the World Islamic Mint (WIM), the Gold Dinar and Securities Standardization Company, and the Dubai Islamic Bank. The introduction of the gold dinar is known to be the model of the state of Kelantan.
Kelantan in northeastern Malaysia has started creating money on gold coins called Gold Dinar Kelantan (GDK) and Silver Dirham Kelantan (SDK). WIN has received dinars and dirhams for each size, such as dinars for 2 dinars, dinars for 1 dinar and ½ gold dinars. Moreover, the recent launch of the gold dinar comes from the state of Perak (2010).
The simple approach to introducing gold dinar into the domestic area proposed by Meera (2004) can be done through an electronic payment system. The gold dinar in domestic transactions is primarily intended for savings, in addition to that for the payment of mahr, zakat and hajj. The card can be used to make payments in gold dinars at points of sale that accept gold dinars.
Source: Integration of al-Rahn with the gold dinar: The initial building blocks towards a gold-based economy by: Meera (2004). Gold dinar in the bilateral payment agreement (BPA) and the multilateral payment agreement (MPA) payment agreement (MPA). In addition, BPA and MPA are considered to be used in the first phase of the physical gold dinar system.
The gold dinar is only the unit of measurement based on volume differences between the country's importer and exporter. Mahathir Muhammad to implement the gold dinar via Bilateral Payments Arrangement (BPA) and Multilateral Payments Arrangement (MPA). Gold and silver bars and coins, gold dinars for investment, gifts or a medium of exchange.
Learning from previous experiences with complementary currencies, the introduction of a gold dinar should take some measures. Therefore, it is necessary to develop an effective model. The proposed model is not a physical gold dinar because it does not meet all the conditions.
ISLAMIC VIEW ON THE PROPOSED MODEL
- The Advantages of the Model
- Islamic View: Justice
- Islamic View: Riba (Usury)
- Islamic View: No element of Gharar
- Islamic view: No containment of Prohibited Elements
In addition, gold is also allowed as a medium of transaction, but it is not physically present in it. All payments and transactions are recorded in a computerized database system where customers can easily view their transaction history. Depository places are preferably in special agencies such as cooperatives and other secured financial agencies.
From the system, the use of gold as a currency is also possible in the creation of financial instruments in futures contracts expressed in terms of the declared weight of gold and silver. The model of the gold dinar as money is contrary to the current system where fiat money is not used in financial and economic transactions. In the system of mobile payments based on gold (MPSBG) and gold dinar in domestic transactions (GDDT), balances in the monetary and real economic sectors are generated by valuable goods that are based on real work or activity.
Justice is an important value that must be appreciated by mankind because it will ensure the well-being of mankind in the world and the hereafter. In most countries Islamic Banking and Finance also operates under this principle..FRB has effects on the ownership structure of assets in the economy, and that this effect violates the Islamic principles of ownership..money creation by FRB is the creation of purchasing power out of nothing which brings about unfair ownership transfers of assets in the economy, effectively to the bank, which is paid for by inflation throughout the economy. In the fiat money system, it can occur throughout interest, fractional reserve banking (FRB) and seigniorage and all the elements have a serious impact on human life, so it is considered as riba (Meera&Larbani, 2009).
Based on the above facts, it is clear that power causes injustice of individual, domestic and in the international relationship. In the case of gold money, it does not experience this condition as gold has an intrinsic value and it is accepted globally. Besides that, the frequently occurring financial crisis in the world economies is due to the existence of gharar element.
In addition, gharar leads to injustice and exploitation between the parties involved in any transaction. In the Islamic perspective, every transaction must be free from prohibited elements such as gambling activities, speculation and manipulation. In the proposed system, gold is used as a standardization of value because of its characteristic stable value.
CONCLUSION
Moreover, in terms of purchasing power over longer periods of time, gold is better than the national currency. It is therefore that all distortion caused by differences and uncertainties can be minimized. Gilani, Yunus, (2014), “The effect of Riba”, IIUM Muamalat researchyahoogroup, [email protected]”, published on March 27, 2014.
2007), The Gold Dinar and Silver Dirham: Islam and the Future of Money, Kuala Lumpur, Malaysia. Use the gold currency or dinar as Israel and America will use gold as a currency in the future. JhonGitau, (2013), Center for Financial Inclusion, Financial Inclusion, Policy, Technology | Tags: Alliance for Financial Inclusion, Financial Inclusion, John Gitau, Kenya, M-PESA, M-Shwari, Mobile Money, Safaricom, South Africa, Retrieved March 11, 2013.
2010), Global Financial Inclusion Achieving full financial inclusion at the intersection of social benefits and economic sustainability, McKinsey Company 2010 Larbani, M (2012), FRB from Islamic Perspective, Conference Paper in 3rd Annual World. Conference on Riba, Kuala Lumpur The Future of Money: Towards New Wealth, Work and a Wiser World “, New European From: European Business Review, Volume 13, Issue 2. Litaer (1999), a currency backed by a predetermined basket of commodities', Green 'Convertible Currency', Glossary, Global Reference Currency.
Meera and Larbani, 2009, “Equity Effects of Fractional Reserve Banking: An Islamic Perspective,” in Humanomics, vol. See also AhamedKameelMydinMeera and Moussa Larbani, “Seigniorage of Fiat Money and the Maqasid al-Shariʿah: The Unattainableness of the Shariʿah,” in Humanomics, vol. 1 (2006); and idem, “Seigniorage of Fiat Money and the Maqasid al-Shariʿah: The Compatibility of the Gold Dinar with the Maqasid,” in Humanomics, vol.
Meera, (2013), “International Seminar – Islamic Finance and Its role in economic development”, UGM, Yogjakarta November Deposit Insurance”, chapter Financial Institutions and Markets”, retrieved from http://wfhummel.cnchost.com/depositinsurance.html , in December 2013. McKinsey (2008), research conducted in collaboration with the Financial Access Initiative (a consortium of researchers at New York University, Harvard, Yale and Innovations for Poverty Action); we relied on financial usage data from Patrick Honohan, “Cross-country variation in Household access to Financial Services,” Journal of Banking &. Michelle Baddeley, (2004), Using E-Cash in the New Economy: An Economic Analysis of Micropayment Systems, Journal of Electronic Commerce Research, VOL. 5, NO.4, 2004, Gonville & Caius College and Faculty of Economics and Politics, Cambridge, UK).
