Gold Pawning in Syariah Banking: An Economic Analysis

Abstract

Gold Pawning in Syariah Banking: An Economic Analysis. Gold Pawning practices in Syariah Banking may create speculative actions due to the volatility of gold prices in markets. The objective of this research is to conduct stress testing whether losses are experienced by the customers while having gold investements or known as berkebun emas. Stress testing is a testing method conducted based on gold farming simulations of the cumulative gold pawning data (qardh) of Indonesian Syariah Banking collected from March 2004 to May 2015. The results of stress testing on gold farming simulations conducted within 131 months show that customers gain profits only within 48 months while the rest 83 months they suffer from losses. It can be concuded that the gold pawning practices are not in accordance with maslahah (public interest) but, in the contrary, contain gharar (deceptive uncertainty). Thus, further studies are highly required to conduct in meeting the syariah.