Jakarta, June 4, 2025 – Faculty of Economics and Business UIN Syarif Hidayatullah Jakarta.
In order to commemorate the 23rd Anniversary of the Faculty of Economics and Business (FEB), the Sharia Economics Study Program held an International Guest Lecture Seminar with the theme “Regulatory Framework, Governance, and Institutional Growth of Islamic Finance in Malaysia”. This activity was held on Wednesday, June 4, 2025, at the 5th Floor Theater of FEB UIN Jakarta, and presented Dr. Mohammad Mahbubi Ali from IIUM Institute of Islamic Banking and Finance (Malaysia) as the main speaker.

The event, moderated by Diamantin Rohadatul Aisy, MA, took place from 09.00 to 13.00 WIB and was attended by students, lecturers, and sharia economic practitioners. In his presentation, Dr. Mahbubi thoroughly discussed the development of the regulatory framework, sharia governance, and institutional growth of the sharia financial industry in Malaysia and compared them with conditions in Indonesia.
Malaysia, according to Dr. Mahbubi, has succeeded in building a reputation as a global Islamic financial center, with a market share of Islamic banking reaching 46.6% and ranked third in the world according to the Islamic Finance Development Indicator (IFDI) 2024. Meanwhile, Indonesia is ranked ninth with a market share of 7.32%.
In terms of regulation, Malaysia has a more comprehensive legal basis through the Islamic Financial Services Act (IFSA) 2013 which is supported by supervision from Bank Negara Malaysia (BNM) and the Securities Commission (SC). In contrast, Indonesia relies on Law No. 21 of 2008 and Law No. 19 of 2008 with supervision from the OJK and the National Sharia Council-MUI.

The sharia governance structure in Malaysia is also considered more mature with the implementation of a two-tier governance model. At the national level, the Shariah Advisory Council (SAC) has the highest authority with binding fatwas. Meanwhile, every Islamic financial institution is required to have a Sharia Committee consisting of at least five people who are qualified in fiqh muamalah and are fluent in Arabic, English, and Malay.
Dr. Mahbubi also highlighted the various models of sharia governance implemented in various countries, including the centralized model in Malaysia and Brunei, the decentralized model in the UK and Singapore, and the two-tier model in Malaysia and Sudan. He emphasized the importance of the independence and professionalism of the sharia board, including the prohibition of dual positions and restrictions on the involvement of active politicians in Malaysia—something that is still relatively loose in Indonesia.

Differences in views on fatwas and financial products were also highlighted, such as differences in views on the bai’ inah, tawarruq, and bay’ dayn contracts. According to Dr. Mahbubi, this shows the urgency of international fatwa harmonization so that sharia finance can operate universally.

Closing the session, Dr. Mahbubi emphasized the strategic role of the Malaysian government in supporting the development of sharia finance through a top-down approach, converting conventional banks to sharia banks, strengthening human resources through institutions such as INCEIF and ISRA, and implementing Value-Based Intermediation (VBI) that balances aspects of profit, sustainability, and social impact.

Through this activity, the Head of the Sharia Economics Study Program, Ali Rama, PhD, hopes to provide global insight and enrich students' perspectives in understanding the dynamics of the international sharia financial industry, while strengthening the internationalization efforts of the study program in the future (AR). "The International Guest Lecture Program is a routine program held by the study program as a form of internationalization of teaching and moreover our study program has been accredited Unggul Lememba," he added. (AR)