nep-isf New Economics Papers
on Islamic Finance
Issue of 2022‒07‒18
three papers chosen by

  2. Analysis of the Soundness Level of All Islamic Commercial Banks in Indonesia 2016-2020 Using the RGEC Method By Mohammad, Wily; Maulidiyah, Nabilla Ryca
  3. Central Bank Digital Currencies, Internet of Things, and Islamic Finance: Blockchain Prospects and Challenges By Al-Ansari, Khalid Ahmed; Aysan, Ahmet Faruk

  1. By: , ABDUROHIM
    Abstract: The Islamic Capital Market in Indonesia has increased; this can be seen from its development; both those who require funding and invest their funds continue to be enthusiastic, not experiencing a decline. TManyfund owners want to invest their funds in the Capital Market. However, he hopes to get results by the teachings he believes do not conflict with Islamic law so that even though the effects are minor, they are halal. To obtain funds from the Islamic capital market in Indonesia, the company must meet the stipulated provisions, namely securing permission from the National Sharia Board and the Financial Services Authority (OJK) so that the Islamic Capital Market in Indonesia recognizes this its existence. Likewise, the company's operations must also meet the provisions that have been set, both for the products and services produced and the utilization of the funds
    Date: 2022–05–21
  2. By: Mohammad, Wily; Maulidiyah, Nabilla Ryca (PT Chishiki NoHikari Indonesia)
    Abstract: Sharia Commercial Banks increased in number from 12 in 2015 to 14 banks in 2020, accompanied by an increase in the number of offices from 1,990 to 2,034 offices in 2020. This achievement must continue to be improved. Therefore, the soundness of Islamic banking must also continue to be improved. The purpose of this study is to practice using the RGEC method in showing the soundness of Islamic commercial banks, as well as to compare the soundness of Islamic commercial banks which are ranked fifth based on the calculation of the final composite value. The benefit of this research is that the public can determine which Islamic commercial bank is better in terms of banking health using the RGEC method. The data analysis method uses the RGEC (Risk Profile, Good Corporate Governance, Earning, and Capital) method by taking NPF, FDR, Self-Assessment GCG, ROA, ROE, NI, BOPO, and CAR data from Islamic commercial bank reports. The results of this study are: First, the soundness of Islamic commercial banks using the RGEC method produces different categories of soundness. In the final result, there are Islamic commercial banks that have PK-1 to PK-5 results. Second, the ranking of the top five of 14 Islamic commercial banks based on the calculation of the final RGEC composite value has different results every year. Based on the average Final Composite Value, the top five ranks respectively are the National Sharia Pension Savings Bank (93.708 Category PK-1 (Very Healthy)), Aceh Syariah Bank (score 89.71 Category PK-1 (Very Healthy)), BPD Nusa Tenggara Barat Syariah (score 87.99 Category PK-1 (Very Healthy)), Bank BNI Syariah (score 86.85 Category PK-1 (Very Healthy)), and Bank Syariah Mandiri (score 81.14 Category PK- 2 (Healthy)).
    Date: 2022–05–18
  3. By: Al-Ansari, Khalid Ahmed; Aysan, Ahmet Faruk
    Abstract: This paper introduces the need for blockchain technology integration for Islamic financial institutions. The paper presents three main applications of blockchain technology. It explains how such technology can be used in the banking and financial sectors by providing examples for each application. Given its relevancy, the paper expands on Central Bank Digital Currencies (CBDCs) as one of the blockchain applications. The paper then discusses salient points on how the banking sector would be affected by what is described as the future of money. Subsequently, an analysis of the use of blockchain in financial services and, in particular, the use for Islamic financial services is provided by examining examples of past successful implementations. The paper then introduces the Internet of Things (IoT) and illustrates the possible technology implementation in financial institutions. The inherent security weakness of IoT is summarized by the potential elimination of that weakness if combined with blockchain (BIoT). The paper concludes by providing a handful of suggestions and recommendations on the urgency of considering CBDCs for future daily operations, integrating Distributed Ledger technology, and using BIoT to safeguard the financial and clients' transaction records.
    Keywords: Blockchain, CBDCs, Internet of Things, IoT
    JEL: F30 G21 G23 L17 O31
    Date: 2022–04–19

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