INCEIF Knowledge Repository (INCEIF University)
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The future of US-China relations: a scientific investigation
No full textIn earlier centuries kings and governments employed astrologists to help them take the best decisions. Present-day governments no longer employ astrologists but still have no clear analytical tool to replace them. Over the past two decades we have developed a methodology for the scientific investigation of recurrent historical events. It consists in two steps. (i) Identification and comparison of historical episodes driven by a common mechanism. (ii) Under the reasonable assumption that what has happened several times in the past is likely to happen again, one then derives testable predictions. This of course is nothing other than the protocol used in experimental science when exploring new phenomena. We believe such a tool can give decision makers much better insight ..
Application of blockchain technology in crowdfunding to fuel the rise of the rest globally
No full textTechnology has advanced with the spread of internet services. Statistics by the United States have estimated that internet facilities have been made available to over a third of the total world population and, in the same vein, access to mobile phones has been rendered to about 85 percent of the population. Crowdfunding finds widespread support via internet platforms and is gaining momentum as a means to empower people and businesses hitherto unable to access banking or access limited facilities therefrom. Today, it has become a mechanism for raising funds to build multi-billion-dollar industries. It is said that the difficulties encountered while struggling to source funds by newly-formed businesses following the 2018 global financial meltdown led to the emergence of crowdfunding. The objective of this research is to present a discourse on how crowdfunding can be facilitated leveraging on blockchain technology. This is a qualitative research where data from literature on the subject matter is analysed and conclusions derived. Outcome of this research revealed that integrating blockchain technology with crowdfunding is possible and benefits all parties involved in the transaction. This integration reduces transaction cost and, from governance perspective, provides certainty and trust to the system and mitigates risk for the parties
Social impact bond (SIB): a Shari'ah appraisal
No full textSocial Impact Bond (SIB) is a funding mechanism for social projects whereby the payment for the projects is anchored on meeting the outcome metrics, otherwise the investors risk losing their money. The mechanism emerged since 2010 in the United Kingdom and has quickly spread to other parts of the world. In the past, there has not been any popular fatwa on this mechanism from a Shari'ah point of view. Therefore, this article will examine the funding and payment arrangement and then conduct takyif fiqhi (jurisprudential adaptation) to ascertain the degree of Shari'ah compliance and determine the most appropriate Islamic contract most suitable under the arrangement. The article adopts a qualitative method of research by making in-depth analysis of Islamic contracts including the primary and secondary sources of Islamic law. It also relied on literature on SIB from conventional point of view and internet materials. Major findings of the research show that SIB, whilst its pay-for-success mechanism does not contain riba, it contains excessive gharar. The excessive gharar, however, was found ineffective to void al-ja 'alah-based SIB and hibah li thawab which is the second contract similar to SIB. This is because of hajah and the element of gratuity respectively
Motivations of institutional investors to invest in affordable housing projects in Malaysia
No full textThe provision of shelter is a fundamental human right as implied in the Maqasid al-Shari'ah, hence Islamic finance should provide avenues to facilitate society in buying affordable homes. This challenge covers the funding aspect of affordable housing development albeit other critical challenges associated such as high land cost, compliance and construction cost, and developers' profit margin. The issue is that market forces dictate property prices that many cannot afford; hence lack of affordable housing is a serious issue being faced by major cities around the globe, including Malaysia. As the public resort to government assistance for policy change to support more affordable housing development, governments, have less option to do so due to fiscal constraints. Worse still, private developers will not build houses that are not profitable to them. To increase the supply of affordable housing, one possible solution is to seek investments from institutional investors with deep pockets to resolve this conundrum. This study aims to investigate factors that motivate institutional investors to invest in affordable housing projects in Malaysia. It consists of two main components, firstly product development, and secondly, marketing research ..
How does microfinance prosper? An analysis of environmental, social, and governance context
No full textThe spotlight of this study is to examine whether environmental, social, and governance performance affects the financial performance of microfinance institutions (MFIs). The topic has been of much interest to researchers and policymakers due to increased awareness among stakeholders on the adverse social and environmental impacts of business actions. Using a dataset covering 5 years for 62 MFIs across 34 countries, we find that environmental and governance performance has no impact on the financial performance of MFIs. As for the social-financial performance nexus, our results reveal a positive relationship using the depth of outreach as proxy of social performance. However, when women empowerment is used as a proxy for social performance, evidence suggest presence of negative relationship. The study contributes to the literature by providing new evidence on the relationship between environmental, social, and governance and financial performance from microfinance industry. Our results are robust to a variety of econometric specifications and have significant policy implications for donors, investors, MFIs, and regulators
Determinants of demand-side intention to use Islamic home financing and supply-side challenges: empirical evidence from Kabul, Afghanistan
No full textThe aim of this research is to examine the issues and challenges of the Islamic home financing market Afghanistan as the country is facing substantial housing shortage due to its growing population and unavailability of land in the major cities where unclear land titles, lack of legal and regulatory frameworks, absence of national housing policies and foreclosure laws constituted major barriers. These problems are compounded with the lack of supply of housing finance and people's low financial capacity to take bank loans and financing. This study first examines the current Islamic banking legal and regulatory framework ..
Application of ta'widh and gharamah in Islamic banking in Malaysia
No full textThe objective of this paper is to explore the practical application of ta'widh and gharamah in Islamic banking in Malaysia with reference to the guidelines that are applicable to date; and find out the issues detected in the implementation of them. In the course of doing this, Shariah reasons for imposing ta'widh and gharamah in Islamic banking are discussed. Also, whether ta'widh and gharamah would be required for Islamic banking with reference to possible alternatives to them is also discussed. This qualitative study primarily focuses on library research and adopts case study approach for analyzing the application of ta'widh and gharamah. The jurisdiction of the study is Malaysia because the central bank of the country has made policies on the matter. The paper draws on observations made by Shariah scholars about the policies on the subject matter. This study gives an insight into the history and issues related to ta'widh and gharamah which are often kept tacit. It is recommended that future studies should look into the effectiveness of these two approaches to serve as a deterrent factor and contribute to the declining rate of non-performing financing in Islamic banks
Waqfintech and sustainable socio-economic development
No full textThis paper aims to discuss the use of financial technology in waqf (Islamic endowment) for funding religious and social causes. It is believed that waqfintech could reach a wider audience and benefit more people in need through the use of innovative financial technology like crowdfunding and blockchain. The main objective of this paper is to introduce the concept of waqfcrowd and waqfcoin as a means of collecting and managing waqf in the digital age. Waqf institutions can thus take advantage of technological innovation to utilise the convenience and efficiency offered by financial technology. This is a conceptual paper which reviews the relevant literature regarding waqf and financial technology. One major limitation of this paper is that it does not discuss the regulatory and operational details of how to institutionalise blockchain technology in different regions. This paper intends to inspire Islamic financial institutions and waqf institutions to harness the potential of waqfintech to raise funds in an effective way
Court referral and Nigeria's Financial Regulation Advisory Council of Experts (FRACE)
No full textThis paper aims to highlight resolution of Islamic finance dispute by common law-orient courts in Nigeria with respect to Shari'ah non-compliance and legal risks thereof, as well as the lesson to learn from Malaysia in that regard. This is with view to ensuring Shari'ah compliance and legal safety of Islamic finance practice as prerequisites for sustainability of the Nigerian Islamic finance industry. A qualitative method was used; interviews were conducted with different categories of experts and primary data collected in relation to Shari'ah non-compliance and legal risks in adjudicating Islamic finance dispute by civil courts and the role of expert advice as basis for court referral to Financial Regulation Advisory Council of Experts. A doctrinal approach was adopted to analyse relevant legislative provisions and content analysis of secondary data relevant to applicable provisions in matters of finance before civil courts
Capital regulation and Islamic banking performance
No full textThis paper empirically assesses the relation between bank performance and capital regulation for Islamic banks from 13 countries and evaluates whether the relation varies with bank size, capital, and liquidity. We find small Islamic banks to be less stable and less profitable; they also cut lending growth as capital regulation becomes more stringent. The stability and lending growth of big Islamic banks are, however, directly related to capital regulation. Further, capital regulation adversely affects the profitability of Islamic banks with low liquidity and high capital holdings. While capital regulation is needed, it should not be adopted in a blanket manner for all Islamic banks