Screening ofMurabahabusiness process through Quran and hadith: a text mining analysis

Issam Tlemsani, Farhi Marir and Munir Majdalawieh

Journal of Islamic Accounting and Business Research, 2020, vol. 11, issue 10, 1889-1905

Abstract: Purpose - This paper revolves around the usage of data analytics in the Qur’an and Hadith through a new text mining technique to answer the main research question of whether the activities and the data flows of theMurabahafinancing contract is compatible withSharialaw. The purpose of this paper is to provide a thorough and comprehensive database that will be used to examine existing practices in Islamic banks’ and improve compliancy with Islamic financial law (Sharia). Design/methodology/approach - To design aSharia-compliantMurabahabusiness process originated on text mining, the authors start by identifying the factors deemed necessary in their text mining techniques of both texts; using a four-step strategy to analyze those text mining analytics; then, they list the three basic approaches in text mining used for new knowledge discovery in databases: the co-occurrence approach based on the recursive co-occurrence algorithm; the machine learning or statistical-based; and the knowledge-based. They identify any variation and association between theMurabahabusiness processes produced using text mining against the one developed through data collection. Findings - The main finding attained in this paper is to confirm the compatibility of all activities and the data flows in theMurabahafinancing contract produced using data analytics of the Quran and Hadith texts against theMurabahabusiness process that was developed based on data collection. Another key finding is revealing some shortcomings regarding Islamic banks business process compliance withSharialaw. Practical implications - GivenMurabahaas the most popular mode of Islamic financing with more than 75% in total transactions, this research has managed to touch-base on an area that is interesting to the vast majority of those dealing with Islamic finance instruments. By reaching findings that could improve the existing IslamicMurabahabusiness process and concluding onShariacompliance of the existingMurabahabusiness process, this research is quite relevant and could be used in practice as well as in influencing public policy. In fact, IslamicSharialaw experts, Islamic finance professionals and Islamic banks may find the results of this study very useful in improving at least one aspect of the Islamic finance transactions. Originality/value - By using a novel, fresh text mining methods built on recursive occurrence of synonym words from the Qur’an and Hadith to enrich Islamic finance, this research study can claim to have been the first of its kind in using machine learning to mine the Quran, Hadith and in extracting valuable knowledge to support and consolidate the Islamic financial business processes and make them more compliant with the i.

Keywords: Islamic banking; Murabaha financing contract; Quran text mining; Screening and audit (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jiabrp:jiabr-05-2020-0159

DOI: 10.1108/JIABR-05-2020-0159

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