CABARAN DAN ALTERNATIF PENYELESAIAN BAGI PENYEDIA PERKHIDMATAN AR-RAHNU DI MALAYSIA (CHALLENGES AND SOLUTIONS FOR AR-RAHNU SERVICE PROVIDERS IN MALAYSIA)

Abstract

The development of Ar Rahnu in Malaysia has triggered a positive phenomenon that has opened the eyes of more industries among financial institutions and non-financial institutions to create this scheme. However, the achievement of each Ar-Rahnu service providers showed a significant different. This significant difference due to the characters and challenges faced by each service providers. Hence, the characters and challenges faced by each operator need to be identified and handled appropriately to ensure the Ar-Rahnu industry growth progressively and effectively. The purpose of this study is to identify the challenges faced by the four categories of Ar-Rahnu agencies in Malaysia representing financial institutions, cooperatives, companies and state-link companies. Therefore, an approach suggested by this paper can be taken at the industry level and the government to overcome the challenges. Accordingly, semi-structural interviews were used through a multi-case study on six agencies comprising Ar-Rahnu service providers. The findings show that most of the challenges faced by industry level are influenced by the size of institution, governance and financial factors. Hence, alternative solutions to the constraints faced need a strategic initiatives between industries and government.