Analysis of Loan Agreements According to Islamic Law and Civil Law

Abstract

This study aims to determine and analyze the loan system according to Islamic Law and Civil Law as well as to find out and analyze its advantages. This type of research is normative law by comparing the agreement law system in Islam and civil law. In other words, this research focuses on the legal norms contained in Islamic and civil law.

The results of this study indicate that the loan system, according to Islamic law, comes from the Arabic word qard which means to borrow. "Qaradh is taking something or other people's goods to take advantage of it within a certain time. Meanwhile, according to civil law, loans related to agreements in civil law which cannot be separated from the Civil Code. According to Article 1313 of the Civil Code, an agreement is formulated as an act whereby one or more persons bind themselves to one or more other persons. The word "agreement" is a translation of overeenkomst, which is one of the sources of engagement (verbintenis). The substance of the agreement in the article is an act (handeling). In addition, the collection of funds at conventional and Islamic banks has similarities and differences. The similarity is that both types of banks seek to benefit from other parties without harming them. The difference is that conventional banks practice interest rates, while Islamic banks use profit-sharing practices. Islamic banks do not use the practice of interest because it is not in accordance with religious teachings. Sources of fundraising in conventional banks are demand deposits, savings, and time deposits, while in Islamic banks, the sources are al wadiah and al mudharabah. People tend to choose banks that provide greater profits because they do not want the funds they invest not to provide profits. It is recommended that the banking system in Indonesia should be able to use muamalah malia'a products rather than usury banking products because the majority of the people are Muslim. The government should also revise the banking law, especially regarding loan, hoping it will be easier for people to apply for loans.