islam & business by internet

8/7/2019 Islam & Business by Internet

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Islam and the usage ofInternet for business

Universiti Kebangsaan Malaysia

Faculty of Law

Pursuing PHD Program in Law

P58462

Musbri Mohamed

DIL; ADIL ( ITM )

MBL ( UKM )

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Before the existence of the Internet, business

used to market their products using the

traditional way. That is by opening up a store

and displaying the products or use direct

selling or giving out brochures or etc by means

of promoting or marketing their products.

But now the thing has changed. Business can

market their products on the Internet. Thus,

enable them to reach out to more people.

When there are more people being exposed to

the product being marketed, it means more

potential buyers. And with more buyers it will

increase the sales of the business.

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Before 1987, there was no online

business being practiced in Malaysia.

Computer is used only for computation

purposes and not being fully utilized.After 1997, the introduction of flagships

of MSC (Malaysia Super Corridor) has

led to the rapid growing of Internet that

consequently improve the using of

technology in all areas, including

business and marketing.

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The Internet refers to the physical network that links

computers across the globe. It consists of the

infrastructure of network servers and wide-area

communication links between them that are used to

hold and transport the vast amount of informationon the Internet.

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Since Internet is a global medium of interaction and

exchanging messages and information, it provides

unlimited resources. People can only surf the Internet to

gain for the desired information, compared to previously,

they have to go to the library or do some research.

Internet can reduce operation cost and time constraint. Itis enable users to purchase their desired good instantly.

Previously, customer has to waste their energy and time,

driving to the store that sells the particular goods or

services to buy their desired good with the possibility

that the good is out of stock. While Internet, ensure that

customer can order or purchased their desired good with

a click of finger, and itll deliver straight to their home.

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Does a hacker pose a threat to Internet

marketing? Yes. Referring to a website, a young

man by the name of Raphael Gray, age 18 years

old, posted some 26000 credit card numbers that

he stole from several e-commerce websites, on

the internet. Imagine what he could do with allthose credit card numbers? He could withdraw

the money from all the account and become an

instant millionaire with just a click of a button.

That means that all our private information

cannot be safely kept in the computer. When we

want to buy something from the Internet, we

have to be extra cautious on the service provider.

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Another reason why Internet marketing faces a

great danger from hackers is that hackers will

degrade a companys image, even a multinational

company. Take Kevin Mitnick, for instance. He

hacked Sun Microsystem, Nokia and MotorolaCorporation. The estimated lost was nearly $300

million. This will certainly gives a bad image to

the company. The public will think that these

companies are not secured enough and they could

not trust to put their money in these companies. It

will cost them time and money to rebuild the

image they have had before.

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What does Islam says about hackers? Certainly during prophet

Muhammads time there was no Internet. But we know Islam is perfect and

universal. By just quoting one ayah we can analyse it and apply it in

various situations.

O ye who believe! Eat not up property among yourselves in vanities: but

let there be amongst you traffic and trade by mutual goodwill(4:29)

If we analyse this ayah and apply in the context of hackers and Internet

marketing, the last line says it all, but let there be amongst you traffic and

trade by mutual goodwill. This means that all form of trade, whether the

trade is in real world or in the Internet, must have the consent of the other

party. Without this consent, whatever trade you are dealing with will not be

valid. This doesnt imply in the hackers world. Hackers break into otherpeople computer system without the knowledge and consent of the system

administrator

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Nowadays, Internet provides the business

community a new way to conduct its business,

locally and internationally. Thus, the existence of

Internet marketing has eliminated the problems oftime and geography. This Internet marketing is the

subset of the electronic business (e-business). The

successful of the Internet marketing is maintain by

having clear strategies, objectives and goal on

their market and also by having an attractive

Website.

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E-commerce is about the exchange of the

digitized information between two or more

parties. This electronic exchange represents an

agreement made by parties with goods and

services are sold. The transaction can be

between organization, business, individual,

buyers, sellers and suppliers. It begins with

negotiating contract based on any

advertisement and promotion displayed in the

Internet. The coordination both parties made

after customer placed an order through online

and payments can be made whether online oroffline.

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Internet gambling first paved its way through the opening of Internet

Casinos, Inc (ICI) on August 18, 1995.The opening of Internet Casinos,

Inc in 1995 marked the worlds first virtual online casino. Today, the

number of online gambling sites has increased rapidly. The sites are

marketed widely and extensively on the Internet. According to Hammond

(2002), in May of 1999, there were over 250 online casino Internet sitesand 139 online sports books. Anyone who has had the experienced to

surfs the Internet would surely has seen the advertisement banner on

online or Internet gambling. With the growth of the Internet, almost

anyone has the ability to place his or her bets either by visiting the various

Internet gambling sites or they can also place their bet on every major

professional or amateur sports event anywhere in the world. The most

recent phenomenon was the online betting for the World Cup footballmatches.

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The increasing amounts of online gambling sites are due to the lack of

regulation concerning the things that are being marketed over the Internet.

This is why such a thing occurs. Therefore, in order to curb the gambling

activities on the Internet especially in Muslim countries from taking place, a

Shariah model of the Internet marketing should be developed, imposed and

practised. Although this may not eliminate the online gambling activitiesaltogether but it can prevent an individual from surfing the gambling sites.

Only through this can we prevent gambling from being marketed through the

Internet. Allah has said in Surah Al-Maidah verse 90;

O ye who believe! Intoxicant, and gambling (dedication of) stone and

divination by arrows, or and abomination of Satans handiwork: eschew such

(abomination) that ye may prosper.

Clearly from the above ayah, Allah has made any form of gambling whether itis being taken place on the Internet or not is considered to be haram or

unlawful. Such activities must be stopped.

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A Shariah model of Internet marketing must be implemented so that

the consequences or the social problems arising from being involved

in Internet gambling can be prevented. There are a lot of crimes

related incidents arise due to Internet gambling. Making gambling

more broadly available via the network threaten heightened crime,

increased incidents of compulsive gambling, and cannibalised

spending in other areas of the economy. Crimes in general, go handin hand with gambling. For an example, gamblers with an addiction

problem can turn into criminals. There was an increased of

approximately 42% in child abuse, 80% in domestic violence,

burglaries and etcetera. More than half of all pathological gamblers

will commit felonies to pay off gambling debts, clearly financial

crimes like embezzlement, check kiting, and tax envision, and credit

card, loan and insurance fraud.

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Regarding gambling marketing through Internet, these

issues can be prevented only if we can produce a citizen

with positive upbringing. Family factors, as the supreme

influence towards the upbringing of a man should

observe and practiced along with the Islamic teachings

in daily life.

A child, who gets the proper education, fardhu kifayah (i.e

science )andfardu ain ( i.e Quran and Hadith ), receive full

attention and close to his family will leads to a mature man

who knows how to handle himself accordingly. Parents,

nowadays, should bear in mind that a good man not only

categorized by those who master in their professional skillsbut also one who have the wide knowledge of Islam.

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Today, electronic money flows has become one

of the most dynamic change in banking systems

after Islamic Banking. Electronic money flows

also describe the present changes in payments

and capital markets. Online banking is an effectof fast development of information technology.

Consequently, it changed the way the business is

conducted. Commercial revolution already

stared by giving variety of products where

customers at any time and anywhere can reach

millions of products just in seconds.

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Now, computer systems are widely used in everyday lives

and especially business. Bar code, scanning and

computerized stock management systems are now able to

be seen to retail consumers compared to few years back.

Secondly on the demand side, there are changes that lead

to an increasingly computer-literate population. Manywomen now move in general workforce and they find

something that satisfies their time measure by

teleshopping (widely accepted in France). It is so

convenient that they can just order groceries via internet

and get orders delivered on the doorstep.

According to historical data, banks in US had a privilege

to first star doing business on line. In fact, they are theones who started the revolution moving from traditional

brick and mortar to click economy.

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Islamic banking is not something new for it is

embedded from Al-Quran and Sunnah hundred

years ago. It is been one of the most successful

development in banking of the Islamic legal

system. The growth of Islamic banking is hard to

measure but a comparison of the balance sheet

footings for the leading Islamic banks shows a

growth of more than 15 percent per year for the

past five years. Now, many banking companies

offers Islamic banking and participate in the latest

technology of banking, on-line Islamic banking.

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Many people are now working and

they can hardly find time to do

settlements of any payments, bills or

shopping for household needs. On-

line banking is so convenient and

time saving. People can avoid trafficjams and parking woes. Besides that,

it is an efficient financial

management and people can manage

faster and easier. Many people who is

working and facing a time constrain

prefers clicking the mice to log in to

auto-payment or electronic billpayment than doing all the tedious

paperwork.

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Internet Banking provides fast and convenient

way to undertake various banking

transactions from the comfort of our home,

office or wherever we may be, during and

after banking hours. Most banking institutionsoffer the service 24 hours a day, 7 days a

week. We avoid traveling time and the need to

wait in queues to access banking services or

to pay bills. This advantage serves all banking

customers: other banks, retail customers and

corporate customers.

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There is not any proving in Quran or Sunnah that on line

banking implicitly is allowed. But, both Quran and Sunnah

proved us guidelines for our everyday life that are

applicable at any time and any where. Therefore, Islam had

provided some basic law that should govern any

transaction, including the one online. Main features of

Islamic ethics are: trustworthiness, honesty, equality, mutualconsent, respect, sacrifice, caring and sharing, concern on

legality. These features must be respect and always keep in

mind.

Also, it has to be emphasized that Islam has never come as

an obstacle for any kind of development in any field. But,

Islam forbids any kind of violence, exploration or unfair use

of any resource.

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Some of orders by Allah to us to follow ethical values can

be found in following ayah:

i) Sincerity (Al-Ikhlas)

To worship Allah, offering Him sincere devotion

(Al Bayyinah: 5)

ii) God consciousness (Al-Taqwa)

But fear Allah and know that Allah is with those who

restrain themselves

(Al-Baqarah: 194)

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Since, we are referring toIslamic online Banking; we

will refer to few Quranic ayahs where Allah strictly

forbids any kind of usury or interest (Riba) but allows

free trade.

Just to recall, Islamic banking differs from conventional

main because it course of bushiness is conducted in a

way to avoid interest involved as much as possible.

Islamic banking in general, and online in particular is

actual an alternative to our Ummah and a way in which

our Ummah can prosper on Shariah allowed way.

This Quranic ayah indicates clearly that usury of

doubling an multiplying is not allowed:

O ye who believe! Devour not usury doubled andmultiplied; but fear Allah; that ye may (really) prosper.

(Al Imran: 130)

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On-line banking using electronic links, make money

transactions and settlements at the speed of light, are

exponentially growing. It makes life simpler and time

constrain is no more a problem. People just need to

access to internet from desktop or laptop, anytime and

anywhere to avoid any hassle of transportation.Now that Islamic banking participates on-line, it shows

that Islam grows with technology thus reflects the nature

of Islam; Islam is for everyone and the teachings of

Islam is applicable anytime and anywhere be it in the

past, present and the future. There is no exact ayah in the

Quran allowing on-line banking but humans are given

brain and knowledge so that they can fully utilize all theresources given by Allah in this world.

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On-line banking, be it Islamic or conventional, are opened to

major possibilities regarding societal, privacy and security

issues. Computerized information is opened to violation if it

falls to the wrong hand. But companies providing online

banking are aware of this situation and have been taking

many safety precautions to protect the right of its customers.Islam permits any developments, innovations and creation as

long as it does not go outside the loop of Islamic Shariah.

So, anything that man designed and created to make life

easier is acceptable as long as it does not contradict with the

teachings of Islam. But, of all the people who created good

things to make life easier, there are some people who just

like destroying good things.

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The principle of Islamic finance are now widely understood, both

within the Muslim world itself and many of the western financial

community who have extensive dealings with Muslim clients.

The Islamic financial movement has undoubtedly been successful

in its educative efforts, and there is widespread respect for the

moral values which have inspired the movement, even from non-

Muslim. The ideas had dating back 1400 years to the time of theprophet Mohammed saw, but modes of financing have needed to

be adapted to meet the complex requirements of modern

commerce, while still being in accordance with thesharia law.

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The power of Internet to reach

millions of users around the world at

any time has made Internet as one of

the most powerful communicationstools available. Marketers,

consumers and business partners

would use the Web to collect

information regarding products,

services or companies they intend to

make business with.

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The development of Islamic Banking Finance

online is significant in moving the society to

accept the Islamic Banking Finance with the use

of new technology.

The main importance of online Islamic Banking

Finance is the availability of services regardless oftime and location. The services are available

wherever and whenever to customers as long there

is Internet connection. This means that the range

of customers is widen regardless of geographical

locations.

The customers in other hand are able to retrieveinformation regarding Islamic Banking Finance at

their convenience.

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The Internet has revolutionized the way people

communicate and receive information. Information,communication and technology (ICT), these three words

had been combined to illustrate the close relation of it to

one another. Institutions may it be academic, political or

financial and even to our personal lives are not able to

deny the impact of these words to the any individual or

organizational.

Online banking has made its entrance and has gradually

gain the customers confidence. Islamic Banking Finance

Online is fast following suit. The Islamic principles that

guided the lives of Muslims worldwide are not only

bounded by the specific form of ritual ibadah but as a

whole. Islam as the way of life in other words covers

all aspect of a humans life. Economic being an

important aspect of life should be adhered to the Islamic

teaching.

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Internet has enable services to be made available

anytime and anywhere. Hence, Muslims or non-

Muslims worldwide can enjoy the Islamic Banking

Finance provided or at least able to gain and widen

their knowledge in Islamic Banking Finance.

However it does not come without total cost. The issueof security will always be there. Yet, it will be

confronted and handled by using the best tools and

taking measurements steps to overcome any foreseen

danger.

The virtual space provides an immense room for

Islamic Banking Finance to venture as long as theonline banking finance is according to the syariah

guidelines.

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In Islamic point of view the best way to

make transaction is by face to face. Body

language, tone of voice, and facial

expressions all help us understand what

the other person is trying to say.

As pursue to the situation face today, we

must use diverse means to communicate

like internet, telephone, fax machine,

Federal Express, the Postal Service, or

maybe even a messenger service.

Musbri Mohamed

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islam & business by internet

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