Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia

Bai Bithaman Ajil (BBA) is the most predominant mode of home financing in Malaysia since the introduction of Islamic banking in 1983. BBA is a deferred installment sale where bank capitalizes its profit up front in the sale of property. The concept is similar to debt financing which is often resulte...

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Main Authors:	Abdul Razak, Dzuljastri, Mohamed, Mustafa Omar, Md Taib, Fauziah
Format:	Conference or Workshop Item
Language:	English
Published:	2008
Subjects:	HG1501 Banking
Online Access:	http://irep.iium.edu.my/3329/ http://irep.iium.edu.my/3329/ http://irep.iium.edu.my/3329/1/BBA_Home_Financing_-_Emprical_evidence.pdf

id	iium-3329
recordtype	eprints
spelling	iium-33292017-06-13T04:57:07Z http://irep.iium.edu.my/3329/ Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia Abdul Razak, Dzuljastri Mohamed, Mustafa Omar Md Taib, Fauziah HG1501 Banking Bai Bithaman Ajil (BBA) is the most predominant mode of home financing in Malaysia since the introduction of Islamic banking in 1983. BBA is a deferred installment sale where bank capitalizes its profit up front in the sale of property. The concept is similar to debt financing which is often resulted in high cost. BBA as practiced in Malaysia is seen not to be in compliant with the Shariah principle as the bank does not take the risk of ownership and liability on the property. Given the controversial features of BBA, it is anticipated that there is high level of dissatisfaction among the present and potential BBA customers including Muslim and the Non-Muslim. Based on a survey of 300 owners and potential house owners, there is high level of dissatisfaction among the customers as evidenced by their low intention to use BBA Muslim customers in general are concerned about the features of BBA notably its compliance with Shariah as well as its inability to fulfill the broad objective of justice, equality and societal well being. The Non-Muslim customers however seem to have greater beliefs in BBA and its ability to fulfill socially desirable objectives. The discontent feelings signal the urgent need by the bankers to come up with alternatives of Islamic home financing product. Musharakah Mutanaqisah or the Diminishing Partnership concept has been proposed to replace BBA for its esteemed features. 2008 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/3329/1/BBA_Home_Financing_-_Emprical_evidence.pdf Abdul Razak, Dzuljastri and Mohamed, Mustafa Omar and Md Taib, Fauziah (2008) Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia. In: IIUM International Accounting Conference IV (INTAC IV), 24-26 June, 2008, Marriot Putrajaya Hotel. (Unpublished) http://www.kantakji.com/fiqh/Files/Finance/s59.pdf
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG1501 Banking
spellingShingle	HG1501 Banking Abdul Razak, Dzuljastri Mohamed, Mustafa Omar Md Taib, Fauziah Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
description	Bai Bithaman Ajil (BBA) is the most predominant mode of home financing in Malaysia since the introduction of Islamic banking in 1983. BBA is a deferred installment sale where bank capitalizes its profit up front in the sale of property. The concept is similar to debt financing which is often resulted in high cost. BBA as practiced in Malaysia is seen not to be in compliant with the Shariah principle as the bank does not take the risk of ownership and liability on the property. Given the controversial features of BBA, it is anticipated that there is high level of dissatisfaction among the present and potential BBA customers including Muslim and the Non-Muslim. Based on a survey of 300 owners and potential house owners, there is high level of dissatisfaction among the customers as evidenced by their low intention to use BBA Muslim customers in general are concerned about the features of BBA notably its compliance with Shariah as well as its inability to fulfill the broad objective of justice, equality and societal well being. The Non-Muslim customers however seem to have greater beliefs in BBA and its ability to fulfill socially desirable objectives. The discontent feelings signal the urgent need by the bankers to come up with alternatives of Islamic home financing product. Musharakah Mutanaqisah or the Diminishing Partnership concept has been proposed to replace BBA for its esteemed features.
format	Conference or Workshop Item
author	Abdul Razak, Dzuljastri Mohamed, Mustafa Omar Md Taib, Fauziah
author_facet	Abdul Razak, Dzuljastri Mohamed, Mustafa Omar Md Taib, Fauziah
author_sort	Abdul Razak, Dzuljastri
title	Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
title_short	Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
title_full	Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
title_fullStr	Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
title_full_unstemmed	Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia
title_sort	consumers’ acceptance on islamic home financing: empirical evidence on bai bithaman ajil (bba) in malaysia
publishDate	2008
url	http://irep.iium.edu.my/3329/ http://irep.iium.edu.my/3329/ http://irep.iium.edu.my/3329/1/BBA_Home_Financing_-_Emprical_evidence.pdf
first_indexed	2023-09-18T20:11:07Z
last_indexed	2023-09-18T20:11:07Z
_version_	1777407484437200896

Consumers’ acceptance on Islamic home financing: empirical evidence on Bai Bithaman Ajil (BBA) in Malaysia

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