An Analysis of Sharia Compliance in Peer-to-Peer Lending Platforms within Islamic Finance

Abstract

This study examines the level of Sharia compliance in peer-to-peer (P2P) lending platforms operating within the framework of Islamic Finance. The rapid growth of fintech has led to the emergence of Sharia-based P2P lending as an alternative to conventional financial systems; however, concerns remain regarding the authenticity of their compliance with core Islamic principles, including the prohibition of riba, gharar, and maysir. This research aims to critically evaluate whether these platforms adhere to Sharia principles in both form and substance. A mixed-method approach is employed, combining qualitative and quantitative techniques. Data are collected from platform documents, including contracts and standard operating procedures, as well as interviews with key stakeholders such as Sharia advisors, users, and regulators. The study applies content analysis and comparative analysis based on standards issued by AAOIFI and DSN-MUI. The findings reveal that Sharia-based P2P lending platforms generally demonstrate moderate (partial) compliance. While they formally adopt Sharia contracts and institutional structures, significant inconsistencies persist in their implementation. These findings indicate a gap between claimed compliance and actual practice, suggesting that compliance is often procedural rather than substantive. The study contributes to the literature by offering a structured and measurable framework for evaluating Sharia compliance in fintech. It also provides practical and policy implications, emphasizing the need for stronger governance, enhanced regulatory oversight, standardized contracts, and the integration of comprehensive Sharia audit systems. Overall, the research highlights that while Sharia P2P lending holds significant potential, achieving full compliance requires more rigorous implementation and continuous supervision to ensure alignment with Islamic financial principles.