IDEAS home Printed from https://ideas.repec.org/a/bcp/journl/v9y2025issue-6p1450-1456.html
   My bibliography  Save this article

Reforming the Global Financial System with a Riba Free System: A Malaysia’s Perspective

Author

Listed:
  • Muhammad Mukhlis Bin Abdul Fatah

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

  • Azlan Bin Md Thani

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

  • Anuar Bin Muhammad

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

  • Shazali Bin Shaharudin

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

  • Muhammad Aiman Shah Bin Shahrilnizam

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

  • Muhammad Syufri Izmil Bin Norsharafuddin

    (Faculty of Accountancy, University Teknologi MARA Alor Gajah, Melaka)

Abstract

The current global financial system that is based on the concept of riba or usury encourages all sorts of elitism, economic imbalance a financial insecurity often emerging into financial systems scandals and vulnerability. On the other hand, shari’ah compliant of the Islamic financial system promoting riba-free financing that entail equity, risk sharing and ethical business practices throughout the society. This paper examines the possibility of the proposed change from conventional system to riba-free systems through an assessment of the benefits of a riba-free system. Furthermore, Malaysia has been chosen in this study due to its role as a leading Muslim country that are consistently offering an Islamic financial system since 1963. Among the benefits of the riba-free systems includes it promotes economic justice and equity, enhanced the financial stability, aligns with cultural and religion values as well as to support the growth of small and medium enterprise (SME) industries. However, this proposed riba-free approach faces some challenges such as the issues of standardisation, greater sensitization and political constraints in many countries. In addition, this paper discusses the fundamentals of riba-free system which were breaks down to the prospects and challenges of carrying out this process on an international scale. In the nutshell, the inclusion of fairness with asset-backed financing enhances a riba-free system as it cares for economic and financial sustainability for all people within the economy as well as to strengthening the ethical values.

Suggested Citation

  • Muhammad Mukhlis Bin Abdul Fatah & Azlan Bin Md Thani & Anuar Bin Muhammad & Shazali Bin Shaharudin & Muhammad Aiman Shah Bin Shahrilnizam & Muhammad Syufri Izmil Bin Norsharafuddin, 2025. "Reforming the Global Financial System with a Riba Free System: A Malaysia’s Perspective," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(6), pages 1450-1456, June.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-6:p:1450-1456
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijriss/Digital-Library/volume-9-issue-6/1450-1456.pdf
    Download Restriction: no
    File URL: https://rsisinternational.org/journals/ijriss/articles/reforming-the-global-financial-system-with-a-riba-free-system-a-malaysias-perspective/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Norazlina Abd. Wahab & Rosylin Mohd Yusof & Zaemah Zainuddin & Jamaltul Nizam Shamsuddin & Siti Farah Norbaini Mohamad, 2022. "Charting future growth for Islamic finance talents in Malaysia: a bibliometric analysis on the Islamic finance domains and future research gaps," Journal of Islamic Accounting and Business Research, Emerald Group Publishing Limited, vol. 14(5), pages 812-837, December.
    2. Mohammed Ayoub Ledhem & Warda Moussaoui, 2021. "Islamic finance for entrepreneurship activities and economic growth: a parametric and non-parametric analysis from Malaysia," PSU Research Review, Emerald Group Publishing Limited, vol. 8(1), pages 1-18, July.
    3. Mohammad Daradkeh, 2023. "Navigating the Complexity of Entrepreneurial Ethics: A Systematic Review and Future Research Agenda," Sustainability, MDPI, vol. 15(14), pages 1-30, July.
    4. Chantal P. Naidoo, 2019. "Relating Financial Systems to Sustainability Transitions: Challenges, Demands and Dimensions," SPRU Working Paper Series 2019-18, SPRU - Science Policy Research Unit, University of Sussex Business School.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Steffen S. Bettin, 2020. "Electricity infrastructure and innovation in the next phase of energy transition—amendments to the technology innovation system framework," Review of Evolutionary Political Economy, Springer, vol. 1(3), pages 371-395, November.
    2. Sheng Ouyang & Renyi Li & Kaili Chen & Zhaoyang Liu, 2024. "Entrepreneurial Sustainability: The Impact Mechanism of Opportunity Co-Creation on Entrepreneurial Action in Underdeveloped Regions," Sustainability, MDPI, vol. 16(20), pages 1-21, October.
    3. Sebastián Uriarte & Cristian Geldes & Jesús Santorcuato, 2025. "Evolution of Ethics and Entrepreneurship: Hybrid Literature Review and Theoretical Propositions," Journal of Business Ethics, Springer, vol. 198(2), pages 321-343, May.
    4. Paul Dewick & Magnus Bengtsson & Maurie J. Cohen & Joseph Sarkis & Patrick Schröder, 2020. "Circular economy finance: Clear winner or risky proposition?," Journal of Industrial Ecology, Yale University, vol. 24(6), pages 1192-1200, December.
    5. Gregor Semieniuk & Emanuele Campiglio & Jean‐Francois Mercure & Ulrich Volz & Neil R. Edwards, 2021. "Low‐carbon transition risks for finance," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 12(1), January.
    6. Le Vu Lan Oanh & Patrizia Tettamanzi & Dinh Tien Minh & Maurizio Comoli & Kamel Mouloudj & Michael Murgolo & Mai Dang Thu Hien, 2024. "How Ethical Behavior Is Considered in Different Contexts: A Bibliometric Analysis of Global Research Trends," Administrative Sciences, MDPI, vol. 14(9), pages 1-38, August.
    7. Haijiao Liu & Jiahui Yu & Boyu Wu & Yanheng Ren & Qing Liu, 2025. "Bibliometric analysis and content analysis of digital entrepreneurship: utilizing the WoS and Scopus databases," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-26, December.
    8. Aleksy Kwilinski, 2024. "Mapping Global Research on Green Energy and Green Investment: A Comprehensive Bibliometric Study," Energies, MDPI, vol. 17(5), pages 1-24, February.
    9. Geddes, Anna & Schmidt, Tobias S., 2020. "Integrating finance into the multi-level perspective: Technology niche-finance regime interactions and financial policy interventions," Research Policy, Elsevier, vol. 49(6).
    10. Chunyan Jiang, 2024. "RETRACTED ARTICLE: Revolutionizing Economic Growth Analysis: a Novel Computational Approach to Assessing the Influence of Technological Financial Efficiency on Real Economic Growth," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(3), pages 11286-11317, September.
    11. Aghilasse Kashi & Mohamed Eskandar Shah, 2023. "Bibliometric Review on Sustainable Finance," Sustainability, MDPI, vol. 15(9), pages 1-30, April.
    12. Zhichong Ma & Yangyang Guo, 2024. "Leveraging Intangible Cultural Heritage Resources for Advancing China’s Knowledge-Based Economy," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(3), pages 12946-12978, September.
    13. Monk, Alexander & Perkins, Richard, 2020. "What explains the emergence and diffusion of green bonds?," Energy Policy, Elsevier, vol. 145(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcp:journl:v:9:y:2025:issue-6:p:1450-1456. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Pawan Verma (email available below). General contact details of provider: https://rsisinternational.org/journals/ijriss/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.