Islamic Cooperative

 The phrase "Islamic Cooperative" or "sharia cooperative" in Indonesia emphasizes economic activities and management in accordance with sharia, applying justice in the distribution of profits and losses, while avoiding riba (usury) and gharar (uncertainty), even though conventional cooperatives are inherently Islamic in principle. Global cooperatives emerged in the 19th century (ICA 1895), while sharia cooperatives appeared later in Malaysia, Nigeria (1990s), Sudan, and Indonesia (1980s), such as Kopontren. In Indonesia, there are 4,011 sharia cooperative units (2023), or 3.1% of the total 130,119 units; research by Elfaki & Embi (2023) in OIC countries shows slower development compared to Islamic banking due to weak regulations, yet it holds potential as a tool for social-economic reform.

Islamic Cooperative is a voluntary association of individuals to meet common economic, social, and cultural needs through a democratically owned and managed enterprise, grounded in Islamic principles, primarily justice, equality, ta'awun (mutual assistance), syura' (consultation), 'adl (justice), and shidq (honesty). Unlike conventional cooperatives, which initially were not anti-interest, the sharia model rejects riba through profit-sharing (mudharabah, musharakah, syirkah), halal contracts, social considerations, and transparent reporting. It aligns etymologically with the Arab concept of syirkah, rejecting gharar/maysir, ensuring social responsibility (maslahah al-amm), zakat, and environmental friendliness.

Sharia cooperatives align with Indonesia's People's Economy (in the style of the Islamic Bung Hatta-Sukarno) and Sharia Economy (Syahyuti, 2024 draft), serving as a primary embodiment for welfare, income distribution, brotherhood, and poverty alleviation. Data: 3,805 Sharia Cooperatives (2018, assets Rp4.71T); 2,439 Kopontren (2021); 3,912 Sharia Savings and Financing Cooperatives (KSPPS) (2022, assets Rp20.67T, 4.6 million members). Goal: holistic ummah welfare, both worldly and hereafter (implicit in Al-Qasas: 77).

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