Hiyal (Legal Stratagems) in Islamic Finance: Systematic Literature Review

Abstract

Purpose: The aim of this study is to systematically review the existing literature on the application of Hiyal (legal stratagems) in Islamic finance. The article visualizes the linkages between different authentic works done on the topic and how the topic has evolved through the decades. Theoretical framework: The article visualizes the linkages between different authentic works done on the topic and how the topic has evolved through the decades. Design/methodology/approach: A systematic literature review of published peer-reviewed articles on Hiyal(legal stratagems) was conducted. A comprehensive search strategy was applied to retrieved 35 articles from 25 leading journals published between 1997 and 2021. Findings: The research found that the existing knowledge on the topic especially of the current century is more focused on Riba (usury) stratagems to circumvent the prohibitions of the conventional capitalist financial system. It is because the discussion popped up as a reaction to the modern Islamic financial system, especially from traditional scholars. Malaysia and a few western countries have contributed the most to the topic. Research, Practical & Social implications: This review provides a significant contribution to Islamic finance literature by identifying the related discussions in the area and pointing the gap that need to be further explored. Originality/value: It is concluded that the literature on the topic ‘the application of Hiyal(legal stratagem in Islamic financial law” is less in numbers and not well-integrated, as the topic is still in the growing stage.