INNOVATION OF THE SALAM FINANCING PRODUCT (A CASE STUDY IN BUMI RINJANI PROBOLINGGO SRB)

Abstract

This paper aims to analyze how the system of salam financing at Bumi Rinjani Probolinggo SRB, studying the factors of salam financing distribution‟s problems; exploring what innovations are needed to increase the implementation of the salam contract; and examining the innovation applied on salam accounting. This type of research is qualitative constructive. The unit of analysis in this study is Bumi Rinjani Probolinggo SRB as the sharia rural bank that provides salam financing. The results showed that Bumi Rinjani SRB are motivated to implement salam financing due to the needs of farmers to purchase the production‟s needs and the short financing period, so that salam financing is the correct type of financing. The financing applied is a single salam contract. Because the items purchased by the SRB are items such as rice, potatoes, maize, with no intention to make such items as inventory, then the SRB entrust the goods to the bai salam customer for resellig by wakalah. There are several factors that become obstacles for SRB related with salam financing, are; 1) The bad character of bai salam customers; 2) Failed harvests; 3) The fluctuative market prices; 4) The provisions of supervisors that the SRB should have a Warehouse. The comprehensive eforts to resolve the problems are; 1) Salam bil wakalah financing; 2) Salam bil Mudharabah financing.