Reviving Umer Chapra's Legacy Through KNEKS' 'Beyond Murabahah' Movement

The Islamic economic world has just lost one of its greatest intellectual pillars. Prof. Umer Chapra, the thinker who wove the epistemological foundations of modern Islamic finance, passed away on 13 June 2026. Remembering Chapra must not fall into biographical romanticism or merely listing monumental works on a bookshelf. The best way to honour the maestro is to test the relevance of his thinking amidst today’s industry realities. During his lifetime, one of Chapra’s greatest anxieties was seeing the Islamic finance industry frequently choose the ‘instant path’ of commercialisation. In Indonesia, this philosophical concern finds its moment of proof through the ‘Beyond Murabahah’ (BM) movement, now vigorously campaigned for by the National Committee for Islamic Economy and Finance (KNEKS). The movement, initiated since KNEKS’ strategic workshop in October 2025, is essentially a practical manifestation of Chapra’s theoretical ideas on Value-Oriented Credit Allocation. This concept involves allocating funds not solely based on short-term profit considerations and collateral availability. Instead, the scheme must consider moral values, social justice, and essential public benefit (Maqasid al-Shari’ah). Funds are directed to productive sectors for equitable welfare distribution, as outlined in Chapra’s 1985 work, Towards a Just Monetary System. If Chapra laid the philosophical foundations in the 1980s, KNEKS today is attempting to dismantle the structural bottleneck of the Islamic financial institution industry, which has become too comfortable in the safe zone of ‘easy’ commercial contracts. KNEKS’ in-depth study of the industry posture reveals a unique polarisation of problems between Sharia Rural Banks (BPRS) and Sharia Commercial Banks (BUS). At the BPRS level, the dominance of murabahah contracts (sale with a margin) is absolute. At the BUS level, the portfolio appears nominally dominated by musyarakah (profit-sharing) contracts. However, one must not be deceived by this numerical illusion. The majority of contracts categorised as musyarakah in the BUS line are actually Musyarakah Mutanaqisah (MMQ). In practice, the currently dominant MMQ is a hybrid contract combined with an Ijarah (lease) contract. The economic impact is starkly contrary to the essence of profit-sharing. Consequently, the portfolio posture of our Islamic banking genuinely suffers from the same ailment: domination by fixed-return contracts. MMQ-Ijarah dominates the upper line, followed by Murabahah in the next. From a regulatory and formal compliance standpoint, murabahah and MMQ-Ijarah are 100% valid and halal. The problem lies not in the fiqh aspect, but in the macroeconomic distortion and socio-economic impact caused when this portfolio portion is too dominant—often exceeding 60-70% in various banks. When the majority of financing relies on these debt-like schemes, the public struggles to distinguish the behaviour of Islamic banks from conventional ones. This continually fuels public scepticism that Islamic finance is ‘just the same’ as conventional. Through the ‘Beyond Murabahah’ movement, KNEKS strives to overhaul this habit. The strategy is to encourage the optimisation of pure profit-sharing contracts (mudharabah/musyarakah) and revive the salam contract (sale with advance payment, goods delivered later). Although salam and murabahah both belong to the sale contract family, they have opposite psychological and economic impacts on the real sector. The BM campaign does not merely push for product diversification but directs Islamic financial institutions to prioritise productive sectors by channelling liquidity to upstream sectors and MSMEs needing real working capital, and to engage in empowerment by becoming partners involved in capacity building, market access facilitation, and technology adoption for clients, rather than passive ‘liquidity sellers’. Dissecting the straight line between Umer Chapra’s critique and the KNEKS movement, three structural traps currently being untangled in Indonesia can be identified: mimicry of conventional credit characteristics, reluctance to finance upstream sectors, and neglect of risk-sharing. The ‘Beyond Murabahah’ campaign rolled out by KNEKS is not merely a banking product repositioning agenda. It is an ideological struggle to restore Islamic banking to its maqasid trajectory, continuing the unfinished legacy of Umer Chapra.