Sunday, August 23, 2009

Agricultural Sector in Syariah Finance

As we know, one of the main problems in agricultural development is the weakness of capital support. The government have tried to overcome this problem by launching some credit programs for the agricultural sector.

Many credit programs, those use fixed interest base, showed less satisfied result. In any cases even generate new problems such as the the greater farmer’s debt and also nonperformance credit.

Based on that phenomena it is required the alternative financing schemes. Sharia scheme, can be choosen as the alternative financing model for supporting agricultural development. Different to the conventional credit, the sharia scheme is free of interest, profit loss sharing equity principle, and profit sharing will be executed in the end of transaction.

To support implementation of sharia finance in agricultural sector, the crucial factors are political will of policy maker and also intensive socialization related to sharia principle finance to public authority and society.

Reference at

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