The Formulation of Islamic Buy Now Pay Later (BNPL) To Achieve Sharia Economic Democratization
DOI:
https://doi.org/10.18592/sjhp.v25i2.16325Keywords:
Islamic Buy Now Pay Later, Inclusive Finance, Islamic Finance, Sharia Economic DemocracyAbstract
The rapid growth of financial technology has reshaped global economic structures and accelerated the diffusion of Buy Now, Pay Later (BNPL) schemes, which commonly rely on interest‑based deferred payments. In Muslim‑majority jurisdictions such as Indonesia, this raises controversy over the permissibility of BNPL, given its riba‑like charges and opaque fee structures, alongside a regulatory gap that has not yet been addressed through a dedicated Islamic BNPL framework. This article examines that gap by asking, first, how a Sharia‑compliant BNPL model can be normatively formulated? and second, how such a model can contribute to achieving Sharia economic democracy? Using normative legal research based on historical and systematic interpretation, and employing conceptual, statute, and comparative approaches, the study analyses BNPL regulation and practice in Qatar, Malaysia, and Indonesia. The findings show that current Indonesian BNPL products embed riba, gharar, and unjust enrichment, whereas Qatar and Malaysia have begun to redesign BNPL through Murabaha, Ijarah, and Qard contracts under explicit Sharia governance and consumer‑protection rules. The study then proposes a legal‑contractual model for Islamic BNPL that combines fixed‑price or cost‑based fees, transparent contractual disclosure, capped non‑profit penalties, and formal Sharia supervision, operationalised through indicators of access, affordability, transparency, anti‑exploitation, and ethical governance. The article concludes by recommending that Indonesian regulators adopt a specific Islamic BNPL act, integrate Islamic supervisory mechanisms, and standardise consumer‑protection safeguards so that Islamic BNPL can function as an instrument of inclusive finance and Sharia‑based economic democracy.References
Abdullah, R., and A Al-Ahmi. “Islamic Financial Products and Consumer Protection: A Study on the Impact of Sharia-Compliant Financial Products on the Market.” Journal of Islamic Finance and Banking 12, no. 4 (2021): 217–32.
Abubakar, A, and M Hossain. “The Role of Fintech in Financial Inclusion: The Case of BNPL Services.” Journal of Financial Regulation & Compliance 30, no. 1 (2022): 44–58.
Adib, N., and A. K. Siti-Nabiha. “Straddling Between Regulation and Innovation: A Case of an Islamic Bank in Indonesia.” Ahkam: Jurnal Ilmu Syariah 16, no. 1 (2016): 89–96. https://doi.org/10.15408/ajis.v16i1.2898.
Ardiansyah, M, and S Mirzanti. “Challenges in Developing Islamic Fintech in Indonesia.” Journal of Islamic Business and Management 10, no. 2 (2020): 134–45.
Arner, D, J. N. Barberis, and R. P. Buckley. “FinTech, RegTech and the Reconceptualization of Financial Regulation.” Northwestern Journal of International Law & Business 37, no. 3 (2017): 371–413.
Asian Development Bank. “If Carefully Managed, Buy Now Pay Later Can Bring More People into The Financial System,” 2022. https://blogs.adb.org/blog/if-carefully-managed-buy-now-pay-later-can-bring-more-people-financial-system.
Baker Mackenzie. “Malaysia: The Consumer Credit Bill 2025.” Consumer Goods & Retail, 2025. https://insightplus.bakermckenzie.com/bm/consumer-goods-retail_1/malaysia-the-consumer-credit-bill-2025.
Bank Negara Malaysia. “Shariah Advisory Council (SAC),” n.d. https://www.bnm.gov.my/shariah-advisory-council.
Basel Committee on Banking Supervision. “Literature Review on Financial Technology and Competition for Banking Services,” 2024.
Bhat, P. Ishwara. Idea and Methods of Legal Research. Oxford University Press, 2020.
Board of Governors of The Federal Reserve System. “The Only Way I Could Aford It: Who Uses BNPL and Why,” 2024. https://www.federalreserve.gov/econres/notes/feds-notes/the-only-way-i-could-afford-it-who-uses-bnpl-and-why-20241220.html.
Chen, M., L. Zhang, and J. Xie. “The Rise of Buy Now, Pay Later Services: Technological Advancements and Financial Inclusion.” Journal of Financial Technology 9, no. 2 (2021): 152–67.
Consumer Financial Protection Bureau. “Buy Now, Pay Later: Market Trends and Consumer Impacts,” 2022.
Fathoni, A. “Problematika Kemiskinan Dan Optimalisasi Fungsi Zakat.” Al-Manahij 5, no. 2 (2011): 167–80.
Ghani, N. A. R. N. A., and A. R. A. Shukor. “Deemed Consent in Islamic Banking from Contract Law Perspective: A Sharia Analysis.” Samarah 8, no. 1 (2024): 39–61. https://doi.org/10.22373/sjhk.v8i1.16305.
Gomber, P., J. A. Koch, and M. Siering. “Digital Finance and FinTech: Current Research and Future Research Directions.” Journal of Business Economics 87, no. 5 (2017): 537–80.
Hadjon, P. M. Introduction to Administrative Law. Universitas Gadjah Mada, 2019.
Haryanto, R. “BAGI HASIL DAN BANK SYARI ’ AH ( Solusi Terhadap Bunga Bank ).” Al-Ihkam 5, no. 2 (2010): 243–56.
Hehanussa, U. K., and S. Syarifuddin. “The Role of Sharia Fintech in Developing Islamic Economy In The Digital Era In Indonesia.” IEFBR 1, no. 2 (2022): 14–22.
Huda, N. “The Impact of Islamic Fintech on Financial Inclusion in Indonesia.” International Journal of Islamic and Middle Eastern Finance and Management 1, no. 2 (2019): 449–63.
Huda, R. “Akad Construction on Credit Card Products (Analysis of Sharia Economic Laws).” Syariah: Jurnal Hukum Dan Pemikiran 19, no. 1 (2019): 119–31. https://doi.org/10.18592/sjhp.v19i1.2041.
Iqbal, M., and A. Mirakhor. An Introduction to Islamic Finance: Theory and Practice. Wiley, 2019.
Irawati, L., M. Z. Hamzah, and E. Sofilda. “Regulating Buy Now Pay Later (BNPL) in Asean: A Comparative Analysis on Regulatory Challenges and Opportunities.” International Journal of Economics, Management, and Accounting 1, no. 4 (2024): 60–81.
Ishak, M. S., A. M. R. Aderemi, and N. S. M. Nasir. “Can Islamic Crowdfunding Unlock New Opportunites For Islamic Banking in Malaysia?” MJSL 12, no. 3 (2024): 562–73.
Jagtiani, J., and C. Lemieux. “The Roles of Alternative Data and Machine Learning in Fintech Lending: Evidence from the LendingClub Consumer Platform.” Financial Management 47, no. 4 (2019): 1009–29.
Khalidin, B., A. Musa, and A. Kiawan. “Murbaha Financing of The Indonesian Islamic Banks Under An Islamic Economic Law and The Fatwa DSN MUI.” Jurnal Kajian Ilmu Hukum Dan Syariah 8, no. 2 (2023): 213–18.
Liberty Street Economics. “Who Uses “Buy Now, Pay Later",” 2023. https://libertystreeteconomics.newyorkfed.org/2023/09/who-uses-buy-now-pay-later/.
Mabrouk, A., and L. Farah. “Liquidity Risk Management in The Islamic Banking: Portofolio of Ijara and Murabaha.” European Journal of Islamic Finance 18 (2021): 1–12.
Maksum, M, and N Hidayah. “The Mechanism of Avoiding Riba in Islamic Financial Institutions: Experiences of Indonesia and Malaysia.” Juris: Jurnal Ilmiah Syariah 22, no. 2 (2023): 235–44. https://doi.org/10.31958/juris.v22i2.6952.
Maulana, M, A A Jihad, A S Fildzia, A Ramly, and Shabarullah. “Islamic Banking Services for Communities and Families in Aceh Province Post Closure of Conventional Banks: A Comprehensive Review.” El-Usrah 7, no. 2 (2024): 903–22. https://doi.org/10.22373/ujhk.v7i2.26312.
Muala, A. “Repositioning of Islamic Economics in the Era of Globalization from the Maqāṣid Syarī’ah Perspective.” Journal of Islamic Law 1, no. 1 (2020): 45–63. https://doi.org/10.24260/jil.v1i1.17.
Nugroho, L, A A Mastur, Harnovinsah, and W Aryanti. “The Contribution of Islamic Bank in Poverty Alleviation.” Al-Ahkam 30, no. 1 (2020): 19–38. https://doi.org/10.21580/ahkam.2020.30.1.5387.
Nurhasanah, N, and I Rahmatullah. “Financial Technology and the Legal Protection of Personal Data: The Case of Malaysia and Indonesia.” Al-Risalah: Forum Kajian Hukum Dan Sosial Kemasyarakatan 20, no. 2 (2020): 197–214. https://doi.org/10.30631/al-risalah.v20i2.602.
Otoritas Jasa Keuangan. “Regulations on the Implementation of Buy Now, Pay Later by Banks and Fintechs in Indonesia,” 2020. https://www.ojk.go.id.
Paylater. “Terms and Conditions,” n.d. https://paylaterapp.com/terms-and-conditions/.
Priyana, Y., S. Mokodenseho, Y. Ibrahim, and S. Yarbo. “Accad Transformation in the Age of Digitalisation: Challlenges and Adaptation in the Context of Islamic Finance.” West Science Islamic Studies 2, no. 2 (2024): 98–105.
Qatar Islamic Bank. “PayLater: Your Interest-Free Installment Solution,” n.d. https://www.qib.com.qa.
Sukma, F, and Zulheldi. “Government Policies in Economic Empowerment of Muslim Communities in the Digital Economy Era.” El-Mashlahah 11, no. 2 (2021): 146–63. https://doi.org/10.23971/elma.v11i2.3108.
Susamto, B. “Penerapan Prinsip Syariah Dalam Lembaga Perasuransian Di Indonesia.” De Jure: Jurnal Hukum Dan Syar’iah 5, no. 1 (2013): 97–106. https://doi.org/10.18860/j-fsh.v5i1.3000.
Sutikno, B., and H. M. Haji. “Understanding Buy-Now-Pay-Later Adoption in the Muslim Market: Do Religious-Based Ethics Matter?” The South East Asian Journal of Management 18, no. 2 (2024): 102–24.
Thaker, M. A. B. M. T., H. B. M. T. Thaker, A. B. A. Pitchay, and A. B. Khaliq. “Leveraging Islamic Banking and Finance for Small Businesses: Exploring the Conceptual and Practical Dimensions.” ADBI Working Paper Series, 2020.
Thalib, P, “Prinsip Syariah Dalam Pengakuan dan Perlindungan Hak Asasi Manusia (Kontribusi Syariah Dalam Upaya Penegakan dan Perlindungan Hak Asasi Manusia)”, Dissertation, Faculty of Law, Universitas Airlangga, Surabaya (2013)
Zaher, F. “Sharia Compliance and Financial Products: An Overview of Islamic BNPL.” Journal of Islamic Financial Studies 13, no. 1 (2019): 45–60.
Zhuratovich, A. M., and A. N. Turdalievich. “The Rise of Islamic Finance in Kyrgyzstan: Challenges, Opportunities, and Strategic Directions.” MJSL 12, no. 1 (2024): 267–71.
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Prawitra Thalib, Fahrian Saleh Siregar, Wimboko, Ibtisam @ Ilyana Ilias, Angelica Milano Aryani Wibisono

This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work.
