Comparative Analysis of Conventional Bank Credit Agreements with Islamic Banks

Abstract

This study discusses that credit provision is the backbone of banking activities. The term credit is widely used in conventional banking systems that are interest based on the interest market, while in Islamic banking law it is better known as financing which is based on the desired real profit (margin) or profit sharing (profit sharing), This type of legal research is normative research with the nature of analytical descriptive research. An Islamic bank credit agreement or known as a financing contract, is made between the lender, namely the president director as the bank or the first party and the credit recipient as the debtor or second party. The similarity of credit agreements between conventional banks and Islamic banks is the legal basis for the implementation of credit agreements for the parties, namely the provisions of Article 1338 paragraph (1) of the Civil Code which regulates the main principle of an agreement or agreement, namely the principle of freedom of contract, is a standard contract, and does not have a specific form of content/standard clause, because it is not determined by law. In the credit agreement of conventional banks and Islamic banks, there are several problems. As an effort to resolve this, several things need to be considered and done by the debtor in considering the clauses of the credit agreement, namely evaluation and negotiation, affirmation of restrictive clauses, availability of creditors who provide financial support for the debtor, opportunity to terminate the agreement, cross-reference, use of indescribable adjectives, grace period and flexibility.