The Potentials and Challenges of Decision Support System for Islamic Banking and Finance

Abstract

Decision Support System (DSS) refers to computer systems designed to help with decision making process. DSS usage are now common in both personal and commercial decision making; including those related to the Islamic faith. Simple Applications (Apps) that help with simple decisions such as to ascertain halal statuses are prevalent. To what extent can DSS facilitate more complicated Islamic decision making such as fiqh ruling, hadith classification and zakat or faraid computations? This paper aims to review DSS initiatives (academic and commercial) intended for the more complicated Islamic or Shariah decision making process and to identify the potentials and challenges especially in the contemporary ijtihad of reviewing and certifying the Shariah compliant statuses of Islamic finance products and services. It is expected that the new digital mindset created by IR 4.0, accelerated by the Covid-19 pandemic; paved the way for the huge potential of Islamic DSS; especially in the Islamic Banking and Finance industry. Artificial Intelligence (AI) technology makes it possible to represent Islamic knowledge into computer processable format to enable complex Shariah decision making. The main challenge is to get a human Shariah expert that is capable of translating his/her knowledge into computable format which leads to lack of Islamic DSS(s) in the market that can be utilized to support Shariah related decision making.

Keywords

• Islamic Decision Support System
• Islamic Banking and Finance
• Shariah Robo-Advisor