INNOVATION IN ISLAMIC BANKING TRANSACTIONS AND FINANCIAL PRODUCTS (ITS OBJECTIVE REASONS, REALISTIC CHALLENGES, AND LEGAL DETERMINANTS)

Abstract

In light of the foresight of the future, talking about financial innovation is inevitable, the development rush is passing, and progress and modernization are accelerating, so no one is waiting for anyone in this. Everyone who has found a way to progress and development has hurried and raced in it. Therefore, this research came to highlight the topic of financial innovation in Islamic banks again, because Islamic banks are concerned with finding financial innovations and serious developments on their current products, and the reason for this, as discussed in the research, is the technological boom, the importance of achieving competitive advantage, and in response to obstacles to achieving profitability goals Because Islamic banks are limited to a limited number of financial products, the renewed need for financial products And for the survival and continuity of these banks.

However, financial innovation in Islamic banks has faced many challenges, most notably the material cost, the potential risk of financial innovations, the laws of central banks, the lack of research and fiqh studies on financial innovation, legitimate obstacles and fiqh problems, the quality of human cadres, and the nature of Islamic financial markets and their limitations.

Finally, the research discussed the legitimate determinants of innovation in transactions of Islamic banks and their financial products, namely the rules of Sharia permissibility, taking into account the legitimate caveats in the door of transactions, the legitimate position of innovation in terms of the origin of contracts or their development, and what is related to emulating traditional financial products, and the importance of starting with needs and then luxuries (First things first).