The Malaysia Financial (Banking and Takaful) Industry in Malaysia has emerged the way forward to a new phase of development. A robust and progressive framework is already in place by the regulator. The new opportunities have opened abundance of opportunities in bringing Islamic finance to the next level. To participate in an emerging industry, Malaysia has introduced a Value-Based Intermediation (VBI) principles.

VBI is defined as:

An intermediation function that aims to deliver the intended outcomes of Shariah through practices, conduct and offerings that generate positive and sustainable impact to the economy, community and environment, consistent with the shareholders’ sustainable return and long-term interests.”

(BNM, 2017)



VBI(T) promotes a more holistic observation of Syari’ah, beyond Syari’ah compliance. i.e ensuring Islamic banking offerings and practices (including TOs) not only comply with Syari’ah requirements but also achieve the intended outcomes of Syari’ah. Intended outcomes of Syari’ah focus on enhancement of well-being of the people through the preservation of wealth, faith, lives, prosperity and intellect.

VBIT aims to deliver the intended objectives of Shariah through best practices, conduct and offerings that generate positive and sustainable impacts on the economy, the community and the environment, consistent with the shareholders’ sustainable returns and long-term interests

Understanding Maqasid Syariah’

The word “Maqasid” means objectives, aspirations or aims, while “Shariah” is “the Divine law as revealed unto the Prophet Muhammad (Peace be upon him)”. Therefore, the term “Maqasid Shariah” means the objectives and goals underlying the principles of Islam.

Islamic Finance is developed with a higher overarching objective or “Maqasid Shariah” that emphasises attainment of positive value creation and prevention of negative impact. In a broader sense, Maqasid Shariah covers the accomplishment of well-being and the avoidance of harm (Do good, do no evil – Amal Ma’ruf Nahil Munkar).

Understanding Maqasid Shariah enhances Takaful value as a means of achieving a well-balanced and sustainable proposition for all stakeholders. The VBIT Framework provides a guide for Takaful practitioners on the awareness of and the process to transform the Takaful industry into an intentional and meaningful journey towards achieving the ultimate objectives of Shariah.

In simpler terms, Maqasid Shariah promotes the welfare of all humankind and prevents harm by preserving the Essentials of Shariah. The Essentials are deemed as basic human rights and are necessary for each human being to live a decent life.

The Essentials are the interests of each human being, and these interests are firmly protected by Islamic Law. Anything threatening the interests of the Essentials should be avoided at all cost.

VBIT Underpinning Thrusts

In the process of creating more value for all the stakeholders involved, TOs are well positioned to facilitate the community and economy in transitioning towards a sustainable future.

The implementation of VBIT as a comprehensive framework that coordinates TOs and key stakeholders can take place gradually to provide ample time for the industry to comprehend the framework and adapt its current practices.

Therefore, a set of clear underpinning thrusts is developed to guide the adoption of VBIT by all TOs in Malaysia to create positive value and sustainable impacts for the respective stakeholders. This integrated set of thrusts serves as a compass for TOs in the journey of implementing VBIT.

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