Sharia Economic Perspective on Online Loans Among Millennials

Abstract

Online loans have become a significant phenomenon among millennials, especially in today's digital era. In the perspective of Islamic economics, online loans are an interesting topic for analysis. First, we will examine aspects of sharia compliance in online loan transactions. In Islamic economics, there are principles such as the prohibition of usury (interest) and gharar (uncertainty) that must be considered. In the context of online loans, it will be analyzed whether the loan mechanism and fees applied are in accordance with these principles. Second, we will look at the social and economic impact of online loans on millennials.  Many millennials are experiencing financial difficulties and are using online loans as a quick solution. However, unwise use of online loans can have negative impacts, such as being trapped in a debt cycle that is difficult to overcome. In an Islamic economic perspective, it will be evaluated whether online loans provide long-term benefits for millennials and society as a whole. Third, alternative options will be discussed in an Islamic economic perspective that can be a solution for millennials in managing their finances. Concepts such as profit-sharing financing, term savings (mudarabah), and risk-sharing financial systems (takaful) will be studied as alternatives that are more in line with Islamic economic principles.