The Implementation of Micro Financing in Sharia Commercial Banks in Undertaking Social Intermediary Function

Abstract

This research aimed at describing the implementation of microfinance in BUS and the application of intermediary social function of sharia bank. The method used descriptive qualitative approach about the implementation of microfinance in BUS in West Java with library research, documentation, and interviews. The results showed that the implementation of microfinance in BUS was distributed directly to individual customers and MSMEs or through sharia microfinance institutions such as sharia cooperatives. The contract used mudharabah, musyarakah, and murabahah. The finance ceiling was between Rp. 2 million to Rp. 200 million with and or without collateral, and with and without assistance. Based on the distribution of microfinance to customers by using mudharabah contracts for investment or working capital (not consumptive), the objectives, and the targets of customers, the intermediary social function of BUS is adequate good. However, the use of murabahah contracts oriented to bank’s profit and the existence of collateral showed that the intermediary social function of BUS has not been optimal yet. Keywords—micro financing; sharia commercial banks; income