Contract (Akad) in Online Banking

Abstract

Internet banking is the latest alternative used by the client to deal with the bank. In this way, the customer can surf the bank website without the hassles of queuing and waiting at the counter. This study will discuss about Internet banking services in terms of Islamic transaction. Where, study touches on contract applications found in banking services. The study found that Internet banking services is allowed in Islam and the contract valid even in the early emergence of Islam's Internet technology sophistication yet exists.

Maqāṣid al-Sharīʿah and the Online Banking System: Implications for Service Delivery

“…In fact, there must be all the elements of a contract present. Rosland et al, (2012) explains that the bank should be the offering party and customer is the accepting party. In the service provided on a virtual platform, the elements of ribā and gharar (uncertainty) must be avoided as much as possible, which means that all charges and other terms and conditions of the contract must be clearly stated and no interest whatsoever should be charged.…”

“…In fact, there are very few studies dealing with online banking from the Islamic perspective, and if there are any, they mostly revolve around behavioural studies on the customer's adoption of online banking (Al-Smadi, 2012;Dalhatu, Abdullah, Ibrahim, & Abideen, 2014), intention to use online banking (Amin, Rahman, Jr, & Hwa, 2011), and challenges facing online banking in Islamic banks (Amin, 2008;Goi, 2015). Only a few studies look at issues related to the Shariʻah's perspective like the concept of ʻAqd (Rosland, Borhan, & Romli, 2012) and some Islamic principles related to online banking (Alotaibi & Asutay, 2015). As a requirement for Shariʻah compliance, online banking needs to fulfil the requirements of the Maqāṣid al-Sharīʿah in terms of ensuring security, ease of use, trust, and cost of services delivered to its customers.…”