TERM DEPOSITS IN THE PERSPECTIVE OF ISLAMIC ECONOMIC LAW

Abstract

Term deposits are widely used as financial instruments in modern banking systems due to their stability and predictable returns. However, their compatibility with Islamic economic law remains a subject of ongoing scholarly debate, particularly when implemented under conventional banking frameworks. Islamic economic law emphasizes the prohibition of riba (interest), gharar (excessive uncertainty), and unjust enrichment, while promoting fairness, risk-sharing, and real economic activity. This study aims to examine time deposits from the perspective of Islamic economic law by analyzing their legal structure, underlying contractual mechanisms, and economic implications. Using a normative–juridical and qualitative approach, this research evaluates time deposits through the lens of fiqh muamalah, Qur’anic principles, Prophetic traditions, and contemporary Islamic economic thought. The findings indicate that conventional time deposits are fundamentally inconsistent with Islamic economic law due to their predetermined interest-based returns and risk-free nature. Conversely, Sharia-compliant alternatives such as mudharabah-based deposits demonstrate closer alignment with Islamic legal and ethical principles when properly implemented. This study contributes to the discourse on Islamic finance by offering a critical yet constructive framework for assessing deposit instruments within Islamic economic law.