Fintech and Shariah Principles in Smart Contracts

Abstract

FinTech, or financial technology, is an emerging technology in financial transaction. It is disruptive technology which is changing the banking behavior for stakeholders. The thriving emergence of FinTech not only affects the conventional finance industry but also Islamic finance industry, as Islamic finance sector is also embracing FinTech as part of financial revolution. Thus, the Islamic FinTech emerges as faith-based FinTech. This is because Islamic FinTech claimed to comply with Shariah principle in their mechanism and smart contract. There is limited discussion on smart contract and Islamic FinTech and its Shariah principles. Hence, the Shariah principle in smart contract of Islamic FinTech need to be addressed. This chapter tries to delve into the smart contract concept in Islamic FinTech and Shariah principles in the mechanism. The review found that smart contract is currently in the early stage and so is Islamic FinTech. The scholars agreed that FinTech is a Maslahah (interest) to mankind's benefit. However, the smart contract is still in discussion and review.