Sharīʿah Compliance in Malaysia’s Digital Payment Systems: Evidence from Expert Interviews

Abstract

Purpose — This study examines the perspectives of Sharīʿah professionals on payment technology and interprets the findings through selected dimensions of maqāṣid al-Sharīʿah (higher objectives of Islamic law), particularly the protection of wealth (ḥifẓ al-māl), intellect (ḥifẓ al-ʿaql), and faith (ḥifẓ al-dīn). Design/Methodology/Approach — A qualitative approach was adopted through semi-structured interviews with ten participants from different Sharīʿah-related backgrounds, including academics, practitioners, consultants, and industry experts. The interviews focused on regulatory, operational, and ethical issues related to payment technology. The data were then analysed using thematic analysis. Findings — Malaysia has introduced various regulatory frameworks for digital financial services. Despite this, concerns about actual Sharīʿah compliance practices still remain, particularly among non-bank digital payment providers whose governance structures may be less established. Participants also raised issues involving operational practices, technological limitations, financial returns, consumer awareness, data vulnerabilities, and the application of Sharīʿah principles within digital payment systems.  These findings relate to the protection of wealth through the prevention of financial harm, the protection of intellect through informed financial decision-making, and the protection of faith through compliance with Sharīʿah principles. Originality/Value — Existing studies in the broader fintech literature mainly discuss adoption issues and regulatory developments. The novelty of this study lies in its focus on Sharīʿah compliance concerns within digital payment services and its interpretation of these concerns through selected dimensions of maqāṣid al-Sharīʿah. Research Limitations/Implications — This study focuses only on Malaysia’s digital payment environment and involves expert interviews with ten Sharīʿah professionals. Future research may consider a broader range of stakeholders, including regulators, digital payment service providers, system developers, and consumers, as well as comparative or mixed-method approaches to provide wider insights into Sharīʿah governance practices in digital payment services. Practical Implications — The findings indicate the need for stronger Sharīʿah governance and clearer monitoring practices within digital payment services, especially among non-bank digital payment providers. Regulators, digital payment providers, Sharīʿah professionals, and system developers should collaborate to ensure that Sharīʿah requirements are consistently embedded within system development and operational processes.