ANALYSIS OF LEGAL GAP BETWEEN SHARIA FINTECH INNOVATION AND SHARIA BANKING REGULATIONS

Abstract

The development of information technology has given rise to new innovations in the financial services industry, one of which is thru sharia- based financial technology. The presence of Islamic fintech brings great potential for increasing financial inclusion and the efficiency of Islamic financial services, but on the other hand, it also raises legal challenges related to legality and Sharia compliance. This research aims to analyze the legality of sharia fintech operations from a legal perspective based on Law Number 21 of 2008 concerning Sharia Banking. Thru a normative legal approach and analysis of sharia principles and DSN-MUI fatwas, this study found that although sharia fintech has characteristics consistent with Islamic muamalah principles, not all platforms are optimally integrated within the framework of sharia banking regulations. There are regulatory gaps that cause some sharia fintech practices to deviate from sharia principles, such as unclear contracts, potential gharar and hidden riba, and weak consumer protection. Therefore, adaptive regulatory and supervisory strengthening is needed to ensure that the operation of Islamic fintech aligns with national Islamic banking regulations and the objectives of Islamic law. Additionally, there needs to be harmonization between Islamic banking regulations and existing financial technology regulations to avoid overlap or legal gaps that could be exploited by irresponsible parties.