Islamic Banking Investment Product Regulation and Contract Innovation in Indonesia: Safeguarding Sharia Compliance and Meeting Industry Needs

Abstract

The growth of the Islamic banking industry has increased the demand for more diverse and flexible investment products tailored to customer needs. However, a fundamental question remains as to how product and contract (akad) innovation can be developed without creating misalignment among contract substance, Sharia principles, and regulatory provisions. This question has become more pressing since the issuance of OJK Regulation (POJK) Number 4 of 2026 concerning the Implementation of Islamic Banking Investment Products, which provides a more specific regulatory framework for Islamic banking investment products. This study aims to analyze the regulatory developments of Islamic banking investment products following the issuance of POJK Number 4 of 2026 and to explore the scope for contract innovation in meeting industry needs while maintaining Sharia compliance. This research employs a qualitative method with a normative juridical approach and a literature review. Primary legal materials include Financial Services Authority (OJK) regulations and DSN-MUI fatwas related to investment products and contracts, while secondary materials consist of scientific journals and relevant literature. The findings indicate that POJK Number 4 of 2026 strengthens the separation of investment products from deposit products through regulations on product characteristics, governance, risk management, segregation of funds and accounting, investor suitability assessment, as well as transparency and investor protection. The regulation also provides room for contract innovation, notably through mudarabah, mudarabah muqayyadah under the Shariah Restricted Investment Account (SRIA), and Wakalah bi al-Istitsmar. Accordingly, contract innovation in Islamic banking investment products should not be understood merely as a change in contract form; it requires alignment among contract substance, risk sharing, governance, and product objectives with Sharia principles and industry needs.