Optimal contract for asset trades: Collateralizing or selling?

Kang, Kee-Youn

doi:10.1016/j.finmar.2020.100590

Cited by 3 publications

(1 citation statement)

References 30 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Consequently, it can be inferred that fiduciary guarantees cater to the interests of both parties, that is, the debtor and the creditor. Additionally, if the borrower has a motivation to overstate the asset's quality, the asset cannot be sold but can be used as collateral instead, making the collateralized loan the most advantageous option (Kang, 2021).…”

Section: Introductionmentioning

confidence: 99%

Violation of Human Right for Collateral Fraud in Sharia Financial Institution Based on Fiduciary Guaranty Law and Rahn Law

Sriani,

Hasan,

Ma'mun

2023

JURIS

View full text Add to dashboard Cite

Fiduciary law in Indonesia and the Islamic concept prohibit the use of collateral that is not one’s own and without the authorization of the owner, but the reality that occurs at BMT BM is not the case. This research aims to analyze the practice of using objects on behalf of others as collateral for ijarah multijasa financing in sharia financial institutions from the perspective of Fiduciary Guarantee Law and Rahn Law. This research is a field study with a legal approach. The empirical results show that although it has been regulated in the law, the use of objects that are not owned and without the permission of the owner as collateral still occurs. There is a way to circumvent the rules, particularly when it comes to the creditor’s obligation to register fiduciary objects but reluctance to do so. As a result, protecting third parties is not achieved. The findings indicate that, to ensure that the parties’ rights are still protected, the government must create a legislation on fiduciary that will take into account debtors with tiny nominal debts who feel burdened by the costs of registering fiduciary objects, as was the case in BMT BM.

show abstract

Section: Introductionmentioning

confidence: 99%