A New Financial Group Lending Based on Smart Contracts: An Agent-based Simulation

Abstract

The aim of this study is to propose a new financial group lending system based on smart contracts, Under blockchain technology and Islamic jurisprudence point of view. The model proposes a new way that Islamic bank can finance projects and attract more investors who are looking for safe, profitable and Shariah compliant investment, this new model attempt to reduce antiquated and inefficient processes, settlement delays, fraud and concentration of risks by digitizing traditional lending paper contracts into a self-executed code line. We also propose an agent-based simulation using Netlogo as a multi-agent environment to experiment the new financial group lending system based on Smart contract.