FINTECH AND ISLAMIC FINANCE – Applying Hiyal & Makharij and other Islamic Principles

On 23 February 2017, the London School of Economics and Political Science (LSE) and Hamad Bin Khalifa University (HBKU) jointly organized a workshop titled “Fintech and Islamic Finance: Applying Hiyal, Makhārij, and Other Islamic Principles.” This workshop built upon participant feedback from an earlier session on Islamic Infrastructure Finance and the Sustainable Development Goals held on 12 February 2016.

Rather than reviewing contemporary fintech technologies, products, or processes, the workshop focused on the Sharīʿah-related challenges that Islamic finance must address to ensure compliance. Its primary aim was to explore whether and how Islamic jurisprudential tools—such as Ahkām Fiqhiyyah, Hiyal, Makhārij, and other exception-based principles—can be applied to resolve specific issues (masāʾil) and achieve public interest (maṣālih) within the fintech landscape.

The discussions were guided by four key objectives:

To examine current fintech practices within Islamic finance and assess their relevance in achieving Sharīʿah compliance.
To identify existing Sharīʿah issues in fintech and determine areas requiring further attention to enhance compliance and support the evolution of Islamic finance.
To evaluate the application of fiqh and ijtihād, particularly the use of tools such as hiyal, Makhārij, and Dhara’i, in developing fintech-driven products, services, and contracts—while considering whether a proactive or reactive approach is more appropriate.
To explore the determination of maṣlahah in light of Maqāṣid al-Sharīʿah, especially in addressing new technologies that challenge existing frameworks, and to consider how differing views on maṣlahah can be managed.

This report provides a summary of the workshop, highlighting the key themes and discussions. The content is presented collectively and is not attributed to individual participants.

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