The Role of Integrating AI-Powered Predictive Analytics in Arbitration for Resolving Islamic Banking Disputes

Mohamad Fateh Labanieh

Mohammad Azam Hussain

Muhammad Habibi Miftakhul Marwa

Hizri Hasshan

 

Abstract: Malaysia has developed a coherent Islamic banking dispute resolution framework that is in line with growth of disputes in Islamic banking industry. However, there is a recognised need for the integration of Artificial intelligence (AI)-powered predictive analytics within the realm of arbitration in Malaysia. This note examines the role of integrating AI-powered predictive analytics in arbitration for resolving Islamic banking disputes. This integration is seen as a way to address several issues such as the potential arbitrator bias and the hesitation of referral a Shariah matter to Shariah Advisory Council (hereinafter referred to as “SAC”) or Shariah expert. The note argues that using AI-powered predictive analytics helps in minimising the negative impact of potential arbitrator bias, like religious and personal bias, and lack of expertise in Islamic banking disputes in Malaysia that are increasing the risk that Shariah-related matters would not be referred to the SAC or a Shariah expert. It is imperative to recognise that regardless of the advancements in AI, Almighty Allah has honoured the children of Adam with intellect, a unique attribute that distinguishes and elevates humanity. Therefore, there is a need to priorities the significance of humans over AI in decision-making processes.