Open Access

Nugroho Widi Adi Ismoyo

• Islamic banking is the new trend emergent within the modern-day banking industry, yet minimal literature is written about it. Most of the literary content today is regarding conventional banking, especially in non-Muslim countries and continents, Europe and U.S. included. Lack of literature is a threat to the operationalization of both modes of banking, due to lack of information and market analysis data. One of the fields where minimal literature coverage exists is market regulation – which is basically information as to how these two types of banking are regulated according to legislative structures. In light of this literature gap, this study emerges to explore the market regulative structure of both Islamic and conventional banks. The methodology to collect primary data is through interviews of selected players in both Islamic and conventional banks, such as bank managers, consultants, and personnel in the IT and finance department. The results of the interviews demonstrate that Islamic banks are faced with shortage of market regulation structures while conventional banks, on the other hand, are overwhelmed with over-regulation. The study provides several feasible solutions for these challenges.