Islamic banking attends as a driver for the booster productive transactions of public funds. Islamic banking are also a financial institution with activities that raise funds from the public and channel funds back to the public. In law No 10 of 1998 it is also clear that a bank is a business entity that collects funds from the public in the from of deposits and distributes them to the community in the form of credit or in other forms to improve the lives of many people. In the Al-Qur'an, Islamic banking is those that have elements such as rights and obligations which, if clearly stated, such as zakat, sadaqah, ghanaimah, ba'I, dayn and mall, they have functions in the role of economic activities.
Islamic Banking runs its activities or activities using islamic principles. Using Islamic laws in the Qur'an and the Hadist. In Islamic Banking, the distribution of funds which is often known as financing and Islamic banking apply a profit-sharing system, not with an interesting system that is forbidden in Islam because it includes usury. The principle of profit-sharing applied in financing is carried out in several contracts, namely the first, the Musyarakah contract is a contract of cooperation between two or more parties that conduct business with each party providing funds with an agreement on the benefit and risks that will be borne together in accordance with the second agreement these parties. Second, the Mudharabah agreement is a cooperation agreement between two or more parties where the first party provides or provides all capital and the second party manages. Profits will be divided according to the agreement agreed in the contract. If the business gets a loss then the party to bear is the first party with clarity that the loss is not due to the mistakes of the manager. Third, the salam contract is a contract of cooperation in agricultural management between the first party and the second party. The first part is the landowner who has provided land for the second party so that the agricultural product is managed. For yields, if in the banking world the harvests obtained between the landowner and the manager will be mutually agreed because the landowner has provided land, seeds, and fertilizer whule the manager provides expertise, energy, and time. So, the benefit obtained from the harvest are in accordance with what the two parties agreed.
The principle of Islamic Banking in avoiding or even eliminating the element of usury is by avoiding the use of the system in determining the interest on loans that are usually done in conventional banks. Avoid the use of a reward system that is contained in deposits in the element of multiplying money automatically. Avoid the use of the usury goods rental system in return for usury goods. There is a reason why usury is forbidden because it is a source of evil in the economy.
Islamic banking has a role in implementing monetary policy because most of the spread of money in the economic system takes place through Islamic banking. Banking activities are closely related to the existence of a payment system, because of the spread of money or the implementation of a non-cash payment system. The Islamic banking regulatory system supports each other in achieving a goal of stabilizing the value of money which will be the responsibility of Bank Indonesia. The stability of the value of money is very important because by supporting sustainable economic development it will improve the welfare of the Indoneisan people.
