This article looks critically into the utilization of third party fund among Islamic Banks in Indonesia, especially in the case of Murabaha financing. Debt and leasing are still the dominant forms of financing products offered by Islamic Banks in Indonesia. The fast growth of the Islamic Banks indicates the extent of shariah bankers’ successes in attracting customers, however there is critique aimed at Shariah banking industry, especially on legal formal discourse. The critique mostly lies around the issue of similarities between murabaha and conventional financing, especially in pricing process of selling products where the shariah banking still depends on rate of interest market. The shariah-banking is also still performing the transfer of risk (one of the conventional bank feature) by internalizing profit sharing margin element with depositor into the process of pricing charged to financing customers. This paper is trying to discuss these matters critically and offers new formulation that is free from rate of interest market.
Keywords: Murabaha, murabaha pricing model, cost of fund, fixed rate.
Sanrego, Y.D. and Abduh, M. (2006). Shariah Compliance of Murabahah Pricing Model: A Critical Review. Tazkia Islamic Business and Finance Review, Vol. 1 No. 2, pp.52-68.