Exploring Shariah-Compliant Gold Investment: The Case of Gold Installments

Abstract

Sharia-compliant investments are gaining popularity among Indonesians, particularly amidst global economic uncertainty. One rapidly growing sharia-compliant investment instrument is gold installments, such as those offered by Bank Syariah Indonesia (BSI). BSI Gold Installments allow customers to purchase Precious Metal gold in installments, using a murabahah contract that complies with sharia principles. This study aims to analyze the risks and returns of BSI's gold installment product and evaluate its suitability as a primary investment instrument for customers seeking sharia-compliant investments. Using a quantitative approach, this study estimates the potential profits and risks of BSI's gold installment program using historical gold price data. The analysis shows that while this product offers attractive profit potential, there are differing views among Islamic scholars regarding the suitability of gold installment contracts with Sharia principles. Nevertheless, this product can be a relatively low-risk investment option, especially for those seeking a more affordable gold investment. This study also suggests comparing BSI's gold installments with other gold investment products, such as pawned gold, to further research their performance and sharia-compliant nature.