Application of the Wasatiyyah Values in the Syariah Governance of the Islamic Banking System in Malaysia

The concept and values of wasatiyyah are fundamental in Islamic banking practice. This is because Islam has delineated basic muamalat principles as a guideline for the banking activity and operation so that all kind of extreme characteristics may be prevented. The principles of wasatiyyah prohibit any element which overlooks the permitted limit namely gambling, uncertainty (gharar), usury, fraud and so on. These elements have to be avoided in life because they were clearly prohibited by Allah SWT due to their oppressive nature especially towards the unfortunate such as the poor or low-income group. This prohibition is also attached with the heavy intimidation in the hereafter. The Islamic banking system upholds the concept of wasatiyyah through the values of fairness, trust, transparency and accountability which are instilled through the syariah governance system.