ARTIFICIAL INTELLIGENCE GOVERNANCE IN ISLAMIC BANKING: RECONSTRUCTING MAQASID AL-SHARI'AH-BASED ETHICAL FRAMEWORKS FOR DIGITAL FINANCIAL DECISION-MAKING
DOI:
https://doi.org/10.59623/5arjb667Keywords:
Artificial Intelligence Governance, Islamic Banking, Sharī'ah Compliance, Financial Decision-MakingAbstract
The accelerating integration of artificial intelligence (AI) into Islamic banking operations has produced an unresolved governance tension between the imperatives of digital financial efficiency and the normative demands of Islamic ethical jurisprudence. While classical Maqāṣid al-Sharī'ah scholarship offers a philosophically rich foundation for evaluating financial conduct, its systematic and operational application to algorithmic decision-making, automated credit scoring, machine-generated Sharī'ah compliance screening, and AI-assisted customer services remains theoretically underdeveloped and practically underspecified. This study undertakes a systematic reconstruction of Maqāṣid al-Sharī'ah as a functional ethical governance architecture specifically adapted to AI deployment in Islamic banking institutions. Drawing on a rigorous qualitative systematic review of 40 peer-reviewed studies published between 2018 and 2026, and employing interpretive content analysis alongside conceptual synthesis, the study maps the five principal Maqāṣid objectives preservation of religion (Dīn), life (Nafs), intellect (ʿAql), progeny (Nasl), and wealth (Māl) onto contemporary AI governance concerns within Islamic finance. The synthesis yields a reconstructed five-pillar framework designated AIGS-M (AI Governance in Islamic Finance based on Maqāṣid), which integrates human oversight mechanisms, algorithmic accountability structures, and Islamic ethical principles to guide digital financial decision-making. Results reveal significant structural misalignments between prevailing AI deployment practices in Islamic financial institutions and core Maqāṣid objectives, most prominently in the dimensions of algorithmic transparency, data privacy, fiduciary integrity, and the preservation of scholarly religious authority. The AIGS-M framework provides an operationalizable governance model with direct implications for Islamic financial regulators, Sharī'ah advisory boards, fintech developers, and policymakers in Muslim-majority jurisdictions.
References
AAOIFI. (2023). Shari‘ah Standards (New Edition). AAOIFI.
Af, M. S. F., & Villaruel, A. (2026). What Artificial Intelligence Can Do To Mitigate Asymmetric Information In Islamic Bank: A Conceptual Framework Revealed. Referensi Islamika: Jurnal Studi Islam. https://doi.org/10.66053/ri.v4i2.342
Alghadi, M. Y., Alqudah, H., Lutfi, A., Ananzeh, H., Marei, A., Almaiah, M. A., & Al-Matari, Y. (2023). Enhancing cyber governance in Islamic banks: The influence of artificial intelligence and the moderating effect of Covid-19 pandemic. International Journal of Data and Network Science. https://doi.org/10.5267/j.ijdns.2023.9.023
Alhammadi, S., Alotaibi, K., & Hakam, D. (2020). Analysing Islamic banking ethical performance from Maqāṣid al-Sharī‘ah perspective: evidence from Indonesia. Journal of Sustainable Finance & Investment, 12, 1171–1193. https://doi.org/10.1080/20430795.2020.1848179
Ali, F., Bouzoubaa, K., Gelli, F., Hamzi, B., & Khan, S. (2025). Islamic Ethics and AI: An Evaluation of Existing Approaches to AI using Trusteeship Ethics. Philosophy & Technology, 38. https://doi.org/10.1007/s13347-025-00922-4
Alsaghir, M. (2023). Digital risks and Islamic FinTech: a road map to social justice and financial inclusion. Journal of Islamic Accounting and Business Research. https://doi.org/10.1108/jiabr-10-2022-0262
Alziyadat, N., & Ahmed, H. (2018). Ethical decision-making in Islamic financial institutions in light of Maqasid Al-Sharia : A conceptual framework. Thunderbird International Business Review. https://doi.org/10.1002/tie.22025
Anggriawan, R., & Hamsin, M. (2026). Deconstructing the digital veil: criminal liability and ethical failures in AI-driven Sharia credit scoring systems in Indonesia. Law, Ethics & Technology. https://doi.org/10.55092/let20260004
Arsyad, I., Kharisma, D. B., & Wiwoho, J. (2025). Artificial intelligence and Islamic finance industry: problems and oversight. International Journal of Law and Management. https://doi.org/10.1108/ijlma-07-2024-0236
Auda, J. (2008). Maqasid al-Shariah as Philosophy of Islamic Law: A Systems Approach. International Institute of Islamic Thought.
Ayub, M., Hassan, M., & Saba, I. (2023). Revisiting the paradigm of Sharīʿah governance of Islamic financial institutions. Journal of Islamic Accounting and Business Research. https://doi.org/10.1108/jiabr-04-2022-0110
Azwar, A., Usman, A., & Abdullah, M. (2025). Artificial intelligence and Islamic finance: A Scopus-based literature mapping through a PRISMA protocol. Journal of Islamic Law on Digital Economy and Business. https://doi.org/10.20885/jildeb.vol1.iss1.art5
Baharom, Z. (2025). Artificial Intelligence and Internal Audit Effectiveness in Islamic Financial Institutions: A Conceptual Paper. International Journal of Research and Innovation in Social Science. https://doi.org/10.47772/ijriss.2025.914mg00195
Billah, M., & Zahid, Z. (2026). Artificial Intelligence in Islamic Fatwa and Shariah Advisory: Opportunities, Limitations, and the Imperative of Human-in-the-Loop Shariah Governance. International Journal of Innovative Inventions in Social Science and Humanities. https://doi.org/10.58806/ijiissh.2026.v3i1n12
Chapra, M. U. (2018). The Islamic Vision of Development in the Light of Maqasid al-Shariah. Islamic Research and Training Institute.
Elmahjub, E. (2023). Artificial Intelligence (AI) in Islamic Ethics: Towards Pluralist Ethical Benchmarking for AI. Philosophy & Technology, 36, 1–24. https://doi.org/10.1007/s13347-023-00668-x
Gustanto, E. S., Nugroho, A. P., & Yahya, M. A. (2025). Risk Management Strategy In Islamic Banks: An Artificial Intelligence Approach. Journal of Principles Management and Business. https://doi.org/10.55657/jpmb.v4i01.227
Harun, M. S., Aziz, M. R. A., Nazri, M., Ananda, R. F., & Rahmadhani, S. (2024). Artificial Intelligence Implications In Islamic Banks: Potential And Challenges. IBAF E-Proceedings. https://doi.org/10.33102/vvbgcv35
Hidayati, W., & Cynthia, E. P. (2024). Evaluating the Role of Maqāṣid al-Sharīʿah in Formulating Ethical Frameworks for Artificial Intelligence in Islamic Jurisprudence. Harmony Philosophy: International Journal of Islamic Religious Studies and Sharia. https://doi.org/10.70062/harmonyphilosophy.v1i2.323
Iqbal, M., Sukamto, F. A. M. S. B., Norizan, S. N. B., Mahmood, S., Fatima, A., & Hashmi, F. (2025). AI in Islamic finance: Global trends, ethical implications, and bibliometric insights. Review of Islamic Social Finance and Entrepreneurship. https://doi.org/10.20885/risfe.vol4.iss1.art6
Islamic Financial Services Board. (2023). Islamic Financial Services Industry Stability Report 2023. IFSB.
Lasmiatun, K., & Manteghi, N. (2025). The Impact of Artificial Intelligence (AI) Implementation on Islamic Financial Literacy and Global Economic Changes in the Banking World. Journal of Lslamic Economics and Bussines Ethics. https://doi.org/10.24235/jiesbi.v2i1.253
Lubis, M. (2024). Integrating Artificial Intelligence and Maqāṣid al-Syarī‘ah: Revolutionizing Indonesia’s Sharia Online Trading System. Computer Fraud and Security. https://doi.org/10.52710/cfs.238
Maiga, M. H. (2025). Achieving Maqāṣid al-Sharīʿah through Artificial Intelligence. Mazahibuna. https://doi.org/10.24252/mazahibuna.vi.55038
Mbaidin, H., Sbaee, N. Q., AlMubydeen, I. O., Chindo, U. M., & Alomari, K. M. (2023). The role of AI integration and governance standards: Enhancing financial reporting quality in Islamic banking. Decision Science Letters. https://doi.org/10.5267/j.dsl.2023.12.001
Mergaliyev, A., Asutay, M., Avdukic, A., & Karbhari, Y. (2019). Higher Ethical Objective (Maqasid al-Shari’ah) Augmented Framework for Islamic Banks: Assessing Ethical Performance and Exploring Its Determinants. Journal of Business Ethics, 170, 797–834. https://doi.org/10.1007/s10551-019-04331-4
Mustapha, R., Karim, S. R. A., Ibrahim, N., Burhan, N. M., & Hayati, N. (2025). Islamic Perspectives On Ai And Cybersecurity: Developing Ethical Frameworks For Autonomous Security Systems. International Journal of Law, Government and Communication. https://doi.org/10.35631/ijlgc.1040041
Ogeawuchi, J. C., Sharma, A., Adekunle, B. I., Abayomi, A. A., & Onifade, O. (2024). Ethical Frameworks for AI Deployment in Financial Decision-Making: Balancing Profitability and Social Responsibility. International Journal of Scientific Research in Computer Science, Engineering and Information Technology. https://doi.org/10.32628/cseit24102141
Omar, M. N., & Sa’ad, A. (2024). Exploring the Potential of Artificial Neural Network in Sharīʿah Decision-making for Digital Banking: A Literature Review. TAFHIM: IKIM Journal of Islam and the Contemporary World. https://doi.org/10.56389/tafhim.vol17no2.5
Raquib, A., Channa, B., Zubair, T., & Qadir, J. (2022). Islamic virtue-based ethics for artificial intelligence. Discover Artificial Intelligence, 2. https://doi.org/10.1007/s44163-022-00028-2
Ridzuan, N. N., Masri, M., Anshari, M., Fitriyani, N. L., & Syafrudin, M. (2024). AI in the Financial Sector: The Line between Innovation, Regulation and Ethical Responsibility. Inf., 15, 432. https://doi.org/10.3390/info15080432
Sain, Z., & Adinugraha, H. (2025). Artificial Intelligence and Islamic Finance: Enhancing Sharia Compliance and Social Impact in Banking 4.0. Journal of Business Management and Islamic Banking. https://doi.org/10.14421/jbmib.2025.0401-03
Shalhoob, H. (2025). The role of AI in enhancing shariah compliance: Efficiency and transparency in Islamic finance. Journal of Infrastructure, Policy and Development. https://doi.org/10.24294/jipd11239
Sidik, H. M., Santosa, W., Arafah, W., Usman, B., Gunawan, I., Mulyadi, M., & Khan, M. A. (2026). The Convergence Of Artificial Intelligence, Bayesian Learning, And Sharia Principles: A Systematic Review Of Islamic Financial Analytics Andentrepreneurial Innovation. Jurnal Manajemen Dan Kewirausahaan. https://doi.org/10.9744/jmk.28.1.49-64
Smolo, E. (2026). Islamic Finance in the Digital Age: Fintech as a Civilizational Tool. Religions. https://doi.org/10.3390/rel17020218
Suardi, D., Azwar, M., Simatupang, A. D., Septi, I., Komariyah, O., & Tidjani, S. (2025). A Maqasid-Based Governance Framework for Islamic Banking: Integrating VBI, ESG, and Ethical Digital Transformation. AL IQTISHADIYAH JURNAL EKONOMI SYARIAH DAN HUKUM EKONOMI SYARIAH. https://doi.org/10.31602/iqt.v11i2.21297
Subli, M., Syamsuddin, D., Amin, A. R. M., Rahim, W., & Sulaiman, S. (2025). Green Investment in Contemporary Islamic Perspective: A Maqasid al-Syari‘ah Analysis of the Mining Industry in Morowali. MILRev: Metro Islamic Law Review. https://doi.org/10.32332/milrev.v4i1.10269
Syakirunni’am, L., Sain, Z. H., Marier, S. M., & Jamil, S. (2025). Artificial Intelligence and the Transformation of Digital Services in Islamic Banking: A Case Study of Bank Syariah Indonesia. LogicLink. https://doi.org/10.28918/logiclink.v2i1.10707
Zahid, Z., Hossain, M. E., & Mohammed, B. A. K. (2025). Leveraging Green Ai For Sustainable Resource Management In Islamic Finance: Bridging The Gap Between Ethical Finance And Environmental Sustainability. International Journal on Cybernetics & Informatics. https://doi.org/10.5121/ijci.2025.140507
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Badruddin, Ahmad Arif, Sutanto (Author)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
This journal adhere to the best practice and high publishing standards and comply with the following conditions:
- Provides immediate open access to its content on the principle that making research freely available to the public supports a greater global exchange of knowledge;
- Allows the author to hold the copyright and to retain publishing right without restrictions;
- Deposits content with a long term digital preservation or archiving program;
- Uses DOIs as permanent identifiers;
- Embeds machine-readable CC licensing information in articles;
- Allows generous reuse and mixing of content, in accordance with CC BY-SA 4.0 license;
- Can provide article level metadata for any indexers and aggregators
