CHAPTER III
RESEARCH RESULTS AND DISCUSSION
3.1 Theoretical Basis
3.1.1 Definition of Islamic banks
In the business world, companies engaged in any field are in dire need of financial institutions to support operational activities carried out to finance their business. Financial institutions that play an important role in meeting the needs of funds or the most complete and safe financial intermediaries are banking financial institutions. From the above problem, the definition of a bank according to the Law of the Republic of Indonesia number 10 of 1998 is confined to banks, it can be understood that the bank is one of the financial institutions that collects funds from the public in the form of savings (funding) and is managed again through lending to community groups lack of funds to stabilize the public finances.
Banking in running a business when viewed from its operational system in determining bank prices is divided into 2 types namely banks based on conventional principles and sharia principles. Where conventional banks determine prices based on the interest method to profit from their business activities. While Islamic banks according to the Law of the Republic of Indonesia number 21 of 2008 article 1 paragraph 12 concerning Islamic banking can be concluded that Islamic banks are financial institutions that carry out their intermediary functions based on the Islamic concept of cooperation in business activities both raising funds and channeling funds without involving the interest system but in a profit sharing scheme (profit or loss shared).
3.1.2 Types and functions of Islamic banks
The activities of Islamic banking with conventional banks have institutional differences that are carried out, where Islamic banks are divided into 3 institutions including:
- Sharia Commercial Bank
Financial institutions whose business activities operate based on sharia principles in which their activities provide services as payment traffic.
- Sharia Business Unit (UUS)
A work unit that conducts business activities using sharia principles and runs side by side with a conventional bank as a branch or parent office of the sharia unit.
- Islamic People’s Financing Bank
An Islamic banking financial institution whose operational pattern follows the principles of Islamic muamalah which in its activities does not provide services on payment traffic.
Islamic banking also has two main functions in facilitating the development of its business, namely as a business entity
and social bodies. Islamic bank functions as a business entity including the role as investment manger, investor and banking service provider. while the Islamic bank functions as a social body including acting as a manager of social funds. clearly the function of Islamic banks can be described in the following table:
TAMWIL
Function:
Investment Management Banking Services Investors
Product applications:
Raise funds
- Custody: savings and current accounts, contracts that are wadiah agreements.
- Revenue share:
savings, deposits and bonds, contracts: mudharabah.
- rent:
bonds, contracts: ijarah. Channeling funds
- revenue sharing pattern:
mudharabah, musyarakah, etc.
- buying and selling patterns:
murabaha, salam, istishna, etc.
- Rental Pattern:
ijarah, etc. Provide
- Financial services:
Wakalah, caliph, hiwalah, qard, rahn, etc.
- Non-financial services:
Wadiah yad amanah.
- Financial services:
Mudharabah, musharaka.
MAAL
Social Function
Application of Funds policy products:
- Collecting and distributing ZIS (Alms, Charity and Alms)
- Distributing Qardhul Hasan
Source: processed data
3.1.1 Principles of Islamic banks
In Islamic banking operations, muamalah principles are needed for the management of business activities carried out by Islamic banks. Broadly speaking, these principles include:
- Principles of trust and caution
In carrying out its business activities, Islamic banks must hold fast to the principles of trust and prudence in managing and raising funds. With the guarantee of supervision and law, it will gain trust for each of the parties concerned.
For example, Islamic banks in providing financing to the public must have confidence in customers that have been analyzed in depth on the intention and ability or ability to pay off the financing has been determined. Likewise, investors who invest their funds must have confidence in the bank towards the funds to be managed properly.
- The principle of awarding contracts for the management of business activities
Activities undertaken by banks in the collection of funds can be in the form of savings in the form of savings, time deposits and demand deposits. Every product that is marketed must apply a contract including a wadi’ah contract, mudharabah contract and ijarah. While the principles applied in channeling funds to customers for financing products are divided into four different categories based on
the intended uses are: the principle of buying and selling, leasing, profit sharing and other complementary principles for financial services.
- Every transaction traffic and in operational activities
In Islamic banks have a clear partnership and the use of funds that is lawful and free from MAGHRIB (maysir, gharar, riba, inner).
3.1.1 Difference between Islamic banks and conventional banks
The comparison of Islamic banks and conventional banks has several different characteristics that can be seen briefly in the following table:
Activities of conventional banks Islamic banks
Operational
- Value-free 1. Invest in halal businesses
- Interest system 2. On the basis of profit sharing, profit margins and fees
- Amount of interest 3. Profit and falah oriented (world and hereafter happiness)
- Money as tradable goods 4. Money as a medium of exchange not as a merchandise
Source; processed data
3.1.5 Definition of Back To Bank Financing
Financing is one of the bank’s products that supports investment in plans run by business partners by providing funding channels to meet financial needs with a system of trust and prudence based on sharia principles. (andrianro, 305)
In Islamic banking, financing can be grouped in several aspects, namely financing is productive and consumptive. In every financing at Islamic banks must have a contract. There are 3 contracts that are often used in Islamic banking, namely mudaraba, musharaka and murabahah.
While the definition of back to back financing is financing provided by Islamic banks by guaranteeing liquid assets of customers who use murabahah contracts. According to Nurtania (2014: 141) Murabaha contract is a sale and purchase agreement of an item with a percentage of income derived from an additional profit (margin) that has been agreed on the sale of said item.
3.2 Back To Back Financing Margin Calculation System at PT. Bank Muamalat Indonesia, Padang Branch
3.2.1 Back To Back Financing at PT. Bank Muamalat Indonesia, Padang Branch
Based on the results of the interview along with data obtained from pt. bank muamalat Indonesia padang branch, Back to back financing is a financing product provided to customers in the form of any purchases of productive nature in halal content. At PT Muamalat Padang Branch, the contract used in this financing is a murabahah or sale and purchase agreement. In this financing, collateral used as collateral can be in the form of the most liquid or young assets disbursed, such as demand deposits, deposits, bonds and other securities. Assets that are used as collateral are mandatory or must be stored in PT Bank Muamalat. As long as this financing has not been paid off, the assets will be held in full by the bank such as pawning goods.
If at any time the customer experiences a traffic jam or is unable to pay, the bank will disburse the collateral to cover the debt in accordance with the remaining debt and return the rest if it exceeds the debt. Currently back to back financing is better known as a deposit guarantee because it is easier to describe in cash. Provision of financing to customers. So this back to back financing is very beneficial in addition to keeping assets intact, customers can still make loans and repayment payments can be obtained from revenue sharing every month of customer deposits.
3.1.1 Back to back financing mechanism
In the process of applying for back-to-back financing prospective customers must follow the implementation provisions, which are as follows:
- Request for financing
Customers who want to make loans through back to back financing must submit an application first. At the first meeting a marketing must be able to provide information needed by customers. Interested customers must be able to fulfill the documents. Documents required to proceed to the approval steps include:
- Complete the documents before the financing committee such as:
1) Original BMI standard financing application application form
2) Copy of prospective customer ID card
3) Copy of Customer’s NPWP
4) Original MUP Special financing for cash-backed financing
5) Original Bank Checking
6) Documents for financing needs (only for ceiling> Rp. 10 billion)
- Complete the documents before the financing agreement
1) Original BMI standard financing application application form
2) Copy of prospective customer ID card, copy of customer’s NPWP
3) Original MUP Special financing for cash-backed financing
4) Original BI Checking
5) Pair Approval
6) Copy of Customer’s partner’s ID card and Copy of the customer’s Family Card (KK)
7) Copy of Marriage Certificate / Marriage Certificate (if married)
8) Original Copy of Divorce Deed / Divorce Deed (if divorced alive) or Original Death certificate from
9) Hospital / Puskesmas / Kelurahan (if the customer’s partner dies) or Original statement letter yet
10) Copy of collateral owner’s ID card and collateral owner’s ID card (if the deposit does not belong to the customer)
11) Copy of NPWP of collateral owner (if the deposit does not belong to the customer)
12) Copy of Family Card (KK) of the collateral owner (if the deposit does not belong to the customer)
13) Copy of Marriage Certificate / Marriage Certificate of the owner of the married collateral (if the deposit does not belong to the customer)
14) Copy of decision on the distribution of assets owned by the collateral owner from the religious court (if the collateral owner is divorced and uses the collateral share)
15) Bilyet / Deposit Advice (ORIGINAL) / TPB Savings Book (ORIGINAL) / Print out Escrow Giro account number based on screen in MARS report
16) Power of Attorney Block / Hold and Unblock Deposit / Giro / TPB
17) Power of Attorney for cash disbursement
18) Original Financing Committee Decision Sheet
19) Original Application Form for Blocking Deposits or hold giro / TPB
20) The original underlying financing contract document
21) Print out the collateral account number at the MCB (if the collateral issuance branch is different from the financier branch)
22) Debit authorization / disbursement signed by the Customer and spouse
- Verifying customer files by the acting bank official
- The ceiling to be provided is only 95% of the guaranteed deposits
- Approval of financing
The file provided by the customer to the bank must be analyzed and verified with an authorized official so that approval can be taken in accordance with the results of the analysis that has been done.
- Binding of financing
After the data submitted by the customer is approved, the bank and the customer must make a financing agreement related to the amount of the loan submitted and make a financial agreement
- Bonding collateral
a loan must bind something as collateral in an effort to control the risk if there is a default and have legal force.
- Blocking of guarantees
After binding the joint legal collateral and signing the law by the acting notary, the collateral used as collateral must be fully held by the bank
- Disbursement of financing
A complete file that has been approved by the bank will be reported to the head office for dropping or disbursing and financing the customer
- Documentation
Complete customer documents regarding back to back financing will be held by legal and custody admins
- Monitoring
In Islamic banks the funds provided will be monitored by the bank’s progress in order to know the condition of the installments that will be made next
- Follow-up default (if a default occurs)
if there is collectibility, then the customer will follow up
- Opening hold / block, repayment and release of guarantee
After the financing installments paid off
a collateral opening for goods used as collateral will be carried out
3.1.1 Back to Back Financing Margin Calculation
Through a financing application that guarantees deposits as collateral, PT. Bank Muamalat Padang Branch uses the annuity method to calculate the margin it gets. Formula annuity method:
Monthly installments = Pl x (I: 12) x 1: [1- {1: (1 + (i: 12)) ^ m}
Margin = Pl x (i: 12)
Installment principal = Total installments – Margin
Information :
Pl = ceiling
i = rate margin
m = number of payment periods
For example, the calculation of back to back financing margins in PT Bank Muamalat Padang Branch. Ibu widia applied for a back to back financing loan of Rp. 500,000,000 and the agreed selling price of the bank is Rp.517,778,501.76 within 1 year or 12 months. From these examples you can find:
Pl = 500,000,000
i = 6.50%
m = 12 months
The financing margin calculation uses the annuity method, namely:
learned:
Monthly installments = Pl x (I: 12) x 1: [1- {1: (1 + (i: 12)) ^ m}
Monthly installments = 500,000,000 x (6.50%: 12) x 1: [1 – {1: (1 +
(6.50%: 12)) ^ 12
= 500,000,000 x (6.50%: 12) x 1: [1 – {1: (1 +
(0.005416667)) ^ 12
= 500,000,000 x (6.50%: 12) x 1: [1 – {1:
(1.005416667)) ^ 12
= 500,000,000 x (6.50%: 12) x 1: [1 – {1:
1.066971852}
= 500,000,000 x (6.50%: 12) x 1: [1 –
{0.937231847}
= 500,000,000 x (6.50%: 12) x 1: [0.062768153]
= 500,000,000 x (6.50%: 12) x 15.93164621
= 2708333,333 x 15.93164621
= 43,148,208.48
The amount of monthly margin calculation is:
Margin = Pl x (i: 12)
Margin = 500,000,000 x (6.50%: 12)
= 500,000,000 x 0.0054167
= 2,708,333,333
Total principal installment calculation
Installment principal = Total installments – Margin
= 43,148,208.48 – 2,708,333,333
= 40439875.15
Main margin Monthly installments Remaining principal
40439875.15 2,708,333.33 43,148,208.48 459560125
40658924.47 2,489,284.01 43,148,208.48 418901200
40879160.31 2,269,048.17 43,148,208.48 378022040.1
41100589.1 2,047,619.38 43,148,208.48 336,921,451
41323217.29 1,824,991.19 43,148,208.48 295,598,234
41547051.38 1,601,157.10 43,148,208.48 254,051,182
41772097.91 1,376,110.57 43,148,208.48 212,279,084
41998363.44 1,149,845.04 43,148,208.48 170,280,721
42225854.57 922,353.91 43,148,208.48 128,054,866
42454577.95 693,630.53 43,148,208.48 85,600,288
42684540.25 463,668.23 43,148,208.48 42,915,748
42915748.18 232,460.30 43,148,208.48 0
3.2 Discussion
From the results of the data obtained, Bank Muamalat Padang Branch uses the annuity method in calculating the margin obtained by banks with a margin rate of 6.50%. This method obtains a margin income that varies every month, where in the first month the margin earned was Rp. 2,708,333,333 and for the following month’s margin income can be multiplied by how much the remaining principal installment remains. But the magnitude of the principal installments changes every month and the margin installments get smaller while the total installments remain. In the first month the principal installment calculation can be seen from the reduction between total installments and the margin obtained which is equal to 40,439,875.15 and the next month is also calculated based on the deduction from the monthly installments with the margin obtained by the bank.