Fatwa Authorities and the Binding Nature of Sharia Norms on ‘Buy Now, Pay Later’: An Analysis of Regulatory Design to Strengthen the Governance of Sharia-Compliant BNPL in Indonesia and Malaysia
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Author
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- Keywords:
- risywah; reciprocity idiom; legal pluralism; fiqh siyasah dusturiyah; money politics
- Abstract
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Background Study: Buy Now Pay Later (BNPL) has rapidly become a major consumer financing mechanism in Southeast Asia, creating regulatory challenges for both state and Shariah authorities. Although previous Islamic legal scholarship has primarily assessed BNPL through contract classification and the prohibitions of riba, gharar, and maysir, limited attention has been paid to how institutional authority determines the normative and regulatory force of Shariah principles. This study addresses this gap through a comparison of Indonesia and Malaysia.
Methods: Employing a normative juridical methodology, this study combines comparative, statutory, and conceptual approaches. The analysis draws on classical fiqh literature, MUI and DSN-MUI fatwas, the Compilation of Sharia Economic Law, AAOIFI Shariah standards, Indonesian financial regulations, and Malaysia’s statutory and policy frameworks governing Shariah governance and consumer credit.
Key Findings: The findings reveal an authority disarticulation in Indonesia, where Shariah norms face institutional discontinuity when BNPL providers lack Shariah Supervisory Boards. State regulation consequently operates mainly through consumer protection and prudential mechanisms. Malaysia demonstrates a more integrated statutory architecture, although substantive Shariah concerns remain, particularly regarding tawarruq-based BNPL structures.
Contribution: This study contributes the concept of authority disarticulation, distinguishes formal from substantive Shariah compliance, and develops a four-dimensional framework for analyzing Shariah authority design.
Conclusion: The study proposes a two-track codification model combining universal behavioral standards for all BNPL providers with Shariah-specific labeling and certification. Such integration is necessary to align normative authority, regulatory enforcement, and consumer protection while preserving the substantive integrity of Shariah-compliant BNPL products.
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