Non-Ethical Elements in Tawarruq Munazzam Product for Islamic Housing Financing In Malaysia

Abstract

This study is to identify non-ethical elements in tawarruq munazzam product as an identical bay’ al- inah and therefore to provide alternative methods in executing the deal. This study is qualitative in which data is collected through library research and interview method. The method of library research is to refer to the reference material derived from muamalat books, related bank circulars and journals. While the interview method is to interview the MBSB bank Shariah executive officer in an unstructured way. The findings show that there are four non-ethical elements in tawarruq munazzam contracts that include tyranny (zulm), treachery (ghubn), not trying to make sure sharia compliance in the product as well as the existence of illegal elements (hilah), ambiguity and obscurity (gharar). The findings also show that there is a temporary alternative method for tawarruq munazzam contracts to be applied.