Cybersecurity, Digital Regulation, and Shariah Compliance Challenges in Islamic Digital Economy
Abstract
The rapid advancement of digital technology has significantly transformed the Islamic economy, particularly in technology-driven financial services such as fintech, e-wallets, crowdfunding, and blockchain. While these innovations create substantial opportunities for inclusive growth in Islamic finance, they also pose new challenges. This study employs a literature review approach to examine three major issues in the Islamic digital economy: cybersecurity, digital regulation, and Shariah compliance. From a cybersecurity perspective, risks such as hacking, data breaches, and online fraud may undermine public trust in Islamic digital financial services. In terms of digital regulation, fragmentation across jurisdictions and the need for harmonized legal frameworks remain critical obstacles in accommodating financial innovations. From the Shariah perspective, challenges arise in ensuring the validity of contracts, transaction transparency, and the avoidance of prohibited elements such as gharar and riba in digital financial products. The findings suggest that the success of the Islamic digital economy relies on collaboration among regulators, service providers, and Shariah authorities to strengthen legal frameworks, enhance technological security, and ensure compliance with Islamic principles.
References
References
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Rabbani, M., Khan, S., & Thalassinos, E. (2020). FinTech, Blockchain and Islamic Finance: An Extensive Literature Review. International Journal of Economics and Business Administration, 8(2), 65–86.
Scott, J. (2024). Digital transformation in Islamic finance: Trends, challenges, and opportunities. International Journal for Science Review, 5(2), 1–15.
Shuib, M. S., Abd Muin, M. A., Mohd Noor, M. N., Mohamad, M. T., & Mansor, N. H. (2024). Digital Payment Transactions: Islamic Finance Perspective. Journal of Advanced Research in Applied Sciences and Engineering Technology, 36(2). https://doi.org/10.37934/araset.36.2.1220
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Suswanto, R. E., Wahyudi, I., Rahmawati, R., & Said, M. (2025). Bridging faith and innovation: A systematic literature review of Islamic FinTech adoption patterns and regulatory frameworks (2020-2024). Al-Muamalat: Jurnal Ekonomi Syariah, 13(1), 1–20.
Wahyudi, H., Wisandani, I., Saputra, C., Lestari, W. R., & Leny, S. M. (2025). Digitalisation of Islamic finance in the era of industrial revolution 5.0: The contribution of crowdfunding and e-wakaf to Islamic fintech. International Journal of Economics and Financial Issues, 15(2), 1–15. https://doi.org/10.32479/ijefi.17480
Wazin, W., Patimah, S., Ansori, A., & Wasehudin, W. (2025). Optimizing AI technology in assessing Islamic financing risks: A SWOT analysis of challenges and opportunities from an Islamic legal perspective (Fiqh). Al-Istinbath: Jurnal Hukum Islam, 10(1), 173–194. https://doi.org/10.29240/jhi.v10i1.11941
Zouari, G., & Abdelhedi, M. (2021). Customer satisfaction in the digital era: Evidence from Islamic banking. Journal of Innovation and Entrepreneurship, 10(9). https://doi.org/10.1186/s13731-021-00151-x
Ahmad, R. A. Y. A. B., Tarshany, Y. M. A., Ayasrah, F. T. M., Mohamad, F. S., Saany, S. I. A., & Pandey, B. (2023). The role of cybersecurity in e-commerce to achieve the Maqasid of Money. International Conference on Computer Science and Emerging Technologies (CSET). https://doi.org/10.1109/CSET58993.2023.10346972
AlFzari, S. M. A. A., Rosman, A. S., Bayoumi, K., & Darawi, A. B. S. @. (2024). Shariah Compliance in Fintech App Solutions: An Islamic Legal Perspective. International Journal of Academic Research in Business and Social Sciences, 14(11), 66–78. https://doi.org/ 10.6007/IJARBSS/v14-i11/23169
Alsaghir, M. (2023). Digital risks and Islamic FinTech: a road map to social justice and financial inclusion. Journal of Islamic Accounting and Business Research. https://doi.org/10.1108/JIABR-10-2022-0262
Alshater, M. M., Saba, I., S., I., & Rabbani, M. R. (2022). Fintech in Islamic finance literature: A review. Heliyon, 8(9). https://doi.org/ 10.1016/j.heliyon.2022.e10385
Alsmadi, A. A., & Omoush, K. S. AL. (2025). Adoption of Islamic Fintech: exploring influential factors and the mediating role of Islamic work ethics. EuroMed Journal of Business, 1–26. https://doi.org/10.1108/EMJB-01-2025-0009
Aysan, A. F., & Unal, I. M. (2023). Challenges in Islamic Fintech and Digitalization: An Extensive Literature Review. World Scientific Annual Review of Islamic Finance, 1, 41–52. https://doi.org/10.1142/S2811023423500028
Bakhrudin, Margolang, F. I., Sudarmanto, E., & Sugiono. (2023). Perspektif Islam tentang Keamanan Siber dan Privasi Data: Implikasi Hukum dan Etika. Hukum Sains Barat Dan Hak Asasi Manusia, 1(4), 166–172. https://doi.org/ 10.58812/wslhr.v1i04.323
Dawood, H., Zadjali, D. F. AL, Rawahi, M. Al, Karim, D. S., & Dr. Mohamed Hazik. (2022). Business trends & challenges in Islamic FinTech: A systematic literature review. F1000Research.
Fidhayanti, D., Noh, M. S. M., Ramadhita, R., & Bachri, S. (2024). Exploring The Legal Landscape of Islamic Fintech in Indonesia: A Comprehensive Analysis of Policies and Regulations. F1000Research. https://doi.org/ 10.12688/f1000research.143476.2
Hasanah, R. A., Hasan, Z., & Muhardi, S. (2025). Development of Syariah Fintech: Challenges and Opportunities in the Digital Economy. Al Dzahab, 6(1), 63–70. https://doi.org/10.32939/dhb.v6i1.4938
Hassan, S. (2025). Decentralized Fintech Platforms Adoption Intention in Cyber Risk Environment. Journal of Financial Innovation and Security, 18(1), 33–48. https://doi.org/10.1016/j.chbr.2025.100687
Ichsan, M., Fitriyanti, F., R., K. R., & Al-Qudah, A. M. (2024). Digitalization of Islamic Banking in Indonesia: Justification and Compliance to Sharia Principles. Jurnal Media Hukum, 31(2), 244–261. https://doi.org/10.18196/jmh.v31i2.22485
Idrees, M. A., & Saif Ullah. (2024). Comparative analysis of Fintech adoption among Islamic and conventional banking users with moderating effect of education level: A UTAUT2 perspective. Journal of Open Innovation: Technology, Market and Complexity, 10(19). https://doi.org/10.1016/j.joitmc.2024.100343
Jain, K., & Gochhait, S. (2024). Risk management approach to financial cybersecurity in Islamic banks: A review. 2024 ASU International Conference in Emerging Technologies for Sustainability and Intelligent Systems (ICETSIS). ASU International Conference in Emerging Technologies for Sustainability and Intelligent Systems (ICETSIS).
Kanwal, A., Tayyab, M., & Idrees, S. (2023). Exploring the nexus of financial technologies, financial inclusion, and blockchain in Islamic finance within digital transformation. Pakistan Journal of Humanities and Social Sciences, 11(4), 4055–4969. https://doi.org/10.52131/pjhss.2023.1104.0674
Khan, W. N., & Khurshid, H. (2024). Cybersecurity and Islamic Law: Navigating the Challenges of the Digital Age. International Journal for Conventional and Non-Conventional Warfare, 1(2).
Malik, M., & Shahzad, I. (2025). Digital Disruption in Islamic finance: A comparative study of FinTech in Islamic and Conventional Financial Systems (2020–2025). Journal of Accounting and Finance in Emerging Economies., 11(1), 49–56. https://doi.org/10.26710/jafee.v11i1.3294
Mollik, E., & Majeed, F. (2025). CYBERSECURITY CHALLENGES IN DIGITAL ISLAMIC BANKING ESTABLISHED IN BANGLADESH: RISK MANAGEMENT PERSPECTIVE. European Journal of Economic and Financial Research, 10(1), 1–15. http://dx.doi.org/10.46827/ejefr.v8i8.1912
Muhammad Sami. (2025). Analysis of the compatibility of blockchain and Bitcoin technology in the digital financial system: A legal and Islamic economic review of financial innovation in the digital era. Sinergi International Journal of Islamic Studies, 8(1), 1–20. https://doi.org/10.61194/ijis.v3i2.759
Muradova, D. A. (2024). The Impact of Digital Financial Technologies on Islamic Insurance and other Financial Institutions: Opportunities and Challenges. Journal of Artificial Intelligence and Digital Economy, 1(6). https://doi.org/ 10.61796/jaide.v1i6.689
Muryanto, Y. T. (2023). The urgency of sharia compliance regulations for Islamic fintechs: A comparative study of Indonesia, Malaysia and the United Kingdom. Journal of Financial Crime, 30(5), 1264–1278. https://doi.org/10.1108/JFC-05-2022-0099
Rabbani, M., Khan, S., & Thalassinos, E. (2020). FinTech, Blockchain and Islamic Finance: An Extensive Literature Review. International Journal of Economics and Business Administration, 8(2), 65–86.
Scott, J. (2024). Digital transformation in Islamic finance: Trends, challenges, and opportunities. International Journal for Science Review, 5(2), 1–15.
Shuib, M. S., Abd Muin, M. A., Mohd Noor, M. N., Mohamad, M. T., & Mansor, N. H. (2024). Digital Payment Transactions: Islamic Finance Perspective. Journal of Advanced Research in Applied Sciences and Engineering Technology, 36(2). https://doi.org/10.37934/araset.36.2.1220
Sudarmanto, E., Yuliana, I., Wahyuni, N., Yusuf, S. R., & Zaki, A. (2024). Transformasi Digital dalam Keuangan Islam: Peluang dan Tantangan. Jurnal Ilmiah Ekonomi Islam, 10(1), 649–660.
Sudarwanto, A. S., Kharisma, D. B., & Cahyaningsih, D. T. (2023). Islamic crowdfunding and Shariah compliance regulation: Problems and oversight. Journal of Financial Crime, 31(4). https://doi.org/10.1108/JFC-01-2023-0003?urlappend=%3Futm_source%3Dresearchgate
Suswanto, R. E., Wahyudi, I., Rahmawati, R., & Said, M. (2025). Bridging faith and innovation: A systematic literature review of Islamic FinTech adoption patterns and regulatory frameworks (2020-2024). Al-Muamalat: Jurnal Ekonomi Syariah, 13(1), 1–20.
Wahyudi, H., Wisandani, I., Saputra, C., Lestari, W. R., & Leny, S. M. (2025). Digitalisation of Islamic finance in the era of industrial revolution 5.0: The contribution of crowdfunding and e-wakaf to Islamic fintech. International Journal of Economics and Financial Issues, 15(2), 1–15. https://doi.org/10.32479/ijefi.17480
Wazin, W., Patimah, S., Ansori, A., & Wasehudin, W. (2025). Optimizing AI technology in assessing Islamic financing risks: A SWOT analysis of challenges and opportunities from an Islamic legal perspective (Fiqh). Al-Istinbath: Jurnal Hukum Islam, 10(1), 173–194. https://doi.org/10.29240/jhi.v10i1.11941
Zouari, G., & Abdelhedi, M. (2021). Customer satisfaction in the digital era: Evidence from Islamic banking. Journal of Innovation and Entrepreneurship, 10(9). https://doi.org/10.1186/s13731-021-00151-x
Published
2025-12-01
How to Cite
Putri, C. (2025). Cybersecurity, Digital Regulation, and Shariah Compliance Challenges in Islamic Digital Economy. Annual International Conference on Islamic Economics and Business (AICIEB), 5(-), 278-284. https://doi.org/https://doi.org/10.18326/aicieb.v5i-.784
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Section
ARTICLES
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