Financing Product Design for Fisheries Through Sharia Micro-Finance Institutions

Abstract

Fishermen in Indonesia have limited access to financial assistant from banks because they do not meet criteria set by the bank. One institution that could be able to provide access and solve this problem is sharia micro-finance institution (SMFI). This study aims for identifying fishermen needs on SMFI financing products and proposing the most suitable financing design which can be applied through SMFI. The study uses qualitative approach by adopting phenomenology technique and holding a focus group discussion (FGD) to acquire the intended design. The study results showed that in general, fishermen of Palabuhan Ratu need financing product from SMFI like consumptive financing for living or family needs and productive financing that can be used to support the sustainability of their business such as purchasing equipment, boats, fishing tools and so on. The proposed design which formulated by this study incorporates double-approaches financing design; firstly, optimizing SMFI’s role as Baitul mall (house of fund) through two Islamic contracts model i.e. Qard or Qardhul Hasan and Temporary Waqf; secondly, both optimizing SMFI as Baitut Tamwil (house of financing) through three financing products that is Parallel Istishna (PI), Syirkah Mudharaba Mutlaqa (SMM) and Ijarah Muntahia Bit Tamlik (IMBT).