Review of Islamic Social Finance and Entrepreneurship

Determinants of intention to become green waqf waqif in Indonesia

Dedy Rachmad — 2025-10-06

Purpose – This study investigated the factors influencing Muslims’ intention to participate in green waqf in Indonesia. Specifically, it examines the role of knowledge within the Theory of Planned Behavior (TPB) framework to understand how knowledge, attitudes, subjective norms, and perceived behavioral control shape the intention to become a waqif (a person who endows waqf).
Methodology – This study employed a quantitative design using survey data collected from 100 Muslim respondents in Indonesia. Data were analyzed with Structural Equation Modeling (SEM) using SmartPLS 3 to test the relationships between knowledge, attitudes, subjective norms, perceived behavioral control, and intention.
Findings – The findings reveal that Knowledge positively influences attitude, and both attitude and perceived behavioral control significantly impact intention to become a waqif. However, subjective norms did not significantly affect intention.
Implications – This study contributes to the existing literature by extending TPB in the context of green waqf and offers insights into the role of knowledge in shaping attitudes toward green waqf. Practically, this study highlights the need for increased awareness and structured initiatives to enhance participation in green waqf, particularly through education and government-driven campaigns.
Originality – This research adds to the growing literature on green waqf by applying and extending TPB with knowledge, offering fresh insights into the behavioral determinants of waqf participation, and highlighting the link between Islamic philanthropy and environmental sustainability.

Social media influencers and sadaqah contribution among university students: Case of International Islamic University Malaysia

Muhammad Irwan Ariffin — 2025-10-02

Purpose – This study examines how social media influencers shape students’ willingness to engage in sadaqah (voluntary charity) at the International Islamic University Malaysia (IIUM), using the theory of planned behavior (TPB) as the guiding framework.
Methodology – A mixed-methods design was employed, combining a survey of 150 students with semi-structured interviews with three influencers active in charitable campaigns. A descriptive analysis of TPB constructs (attitude, subjective norm, perceived behavioral control, and behavioral intention) was conducted alongside thematic analysis of the interview data.
Findings – Students reported high exposure to influencer-promoted campaigns, particularly on Instagram and TikTok. Attitudes toward sadaqah were positive, and subjective norms were influential, as many felt encouraged to donate when their peers participated. However, financial constraints and trust-related concerns limit donations and underscore perceived behavioral control as a barrier. Influencers have highlighted the importance of emotional storytelling, transparency, and alignment with Islamic values in motivating contributions.
Implications – Campaigns should pair credible, value-congruent influencers with platforms that have clear Shariah governance, transparent fund allocation, and visible verification to build trust; lower behavioral frictions through micro and recurring donation options, simple payment flows, and salient security cues; and leverage subjective norms by embedding peer-sharing prompts and social proof. Universities and NGOs can co-create cause-fit content with emotional storytelling and real-time impact updates to convert intentions into actual donations.
Originality – This study is among the first to explore influencer-led sadaqah campaigns in Malaysia by integrating TPB with insights from Islamic social finance and digital philanthropy.

Analysis of the impact of zakat fund distribution on mustahik productivity in Indonesia

Nispia Asya'bani — 2025-10-10

Purpose – This study examines the influence of zakat fund distribution on the productive behavior patterns of mustahiks in Indonesia, involving the moderating role of financial literacy. This study additionally examines the alterations in the behavior patterns of mustahiks following the receipt of zakat fund assistance.
Methodology – This study employed a sequential explanatory mixed-methods design to examine the behavioral impacts of zakat distribution. In the quantitative phase, survey data were collected from 109 purposively selected mustahiks, using Likert-type items. The data were analyzed through Partial Least Squares Structural Equation Modeling (PLS-SEM) to estimate the effects of Zakat distribution on both productive and consumptive behavior, while also testing the moderating role of financial literacy.
Findings – The results show that the variable of zakat fund distribution has a positive and significant effect on the productive and consumptive behavior of mustahik. The interplay of Sharia financial literacy as a moderating component can affect the connection between zakat fund distribution.
Implications – The results of this research can be used as a reference for zakat institutions to monitor the impact of zakat fund distribution on beneficiaries and understand the factors influencing it.
Originality – This research contributes to the existing literature by providing concrete evidence regarding the impact of zakat fund distribution on the behavior patterns of mustahiks, whether they receive productive or consumptive zakat. Additionally, there is an examination of the role of financial literacy, which acts as a factor that can strengthen or weaken that relationship.

It’s giving halal: Gen Z behavior bridging halal certification and MSMEs’ purchase intention

Nimas Ayu Arumbinang — 2025-10-02

Purpose – This study evaluates the influence of halal certification and Islamic marketing strategies on the purchase intention of MSMEs culinary products, with Gen Z consumer behavior as a mediating variable. The Islamic marketing approach references the SGIE 2023 Halal Lifestyle Marketing Mix (HLMM), which integrates the principles of amanah, taqwa, ihsan, and adl into the 4Ps framework.
Methodology – Primary data were collected from Muslim respondents aged 17–26 years in West Java, a province promoting halal tourism and MSMEs growth. Structural Equation Modeling (SEM) was employed to test the proposed model.
Findings – Halal certification significantly enhances consumer behavior, which in turn drives purchase intention. However, a negative direct effect of halal certification on purchase intention suggests a full mediation effect, where halal certification for MSMEs boosts Gen Z purchase intention only when it shapes how they think and act. Islamic marketing strategies also show a positive, albeit smaller, effect on consumer behavior and purchase intention.
Implications – Government efforts focusing solely on MSME certification could trigger consumer skepticism and discourage purchases. Therefore, initiatives must be coupled with Islamic marketing strategies that translate halal labels into meaningful consumer value.
Originality – This study advances the Theory of Planned Behavior (TPB) by modeling consumer behavior as a second-order construct and operationalizing Islamic marketing through the Halal Lifestyle Marketing Mix (HLMM). Focusing on MSMEs offers a novel perspective on how enterprises with typically weak brand identities can leverage the halal label as a market signal that shapes consumer intention.

Green finance from the perspective of Islamic social finance: A case study of microfinance practices in Istanbul

Testru Hendra — 2025-10-06

Purpose – This study aims to explore and analyze the integration of green finance principles with Islamic microfinance practices in Istanbul, Turkey. Specifically, it examines how Islamic microfinance institutions incorporate environmental and social sustainability values into their operational activities and investigates the role of Islamic social finance instruments, such as zakat, infak, sedekah, waqf, and qard al-hasan, in supporting the achievement of the Sustainable Development Goals (SDGs).
Methodology – Employing a qualitative research design with a case study approach, data were collected through in-depth interviews, participatory observations, and document analysis involving key stakeholders of Islamic microfinance institutions in Istanbul. The data were analyzed using thematic analysis to uncover recurring patterns and themes related to the adoption of green finance principles. The key variables examined included environmental sustainability, social sustainability, Sharia compliance, and the effectiveness of Islamic social finance tools.
Findings – Findings indicate a positive but partial integration of green finance principles into Islamic microfinance practices, with notable contributions from zakat and waqf in promoting social welfare and environmental responsibility. However, challenges such as regulatory constraints, limited awareness, and difficulties in measuring impact have also been identified.
Implications – These implications underscore the need for enhanced regulatory support, capacity building, and awareness programs to foster a more robust and sustainable Islamic microfinance sector.
Originality – This study contributes both conceptually and practically to the literature on sustainable Islamic finance and provides strategic recommendations for policymakers, practitioners, and researchers. This study is expected to support the advancement of inclusive, ethical, and environmentally responsible microfinance models aligned with Sharia principles and global sustainability agendas.

Long term nexus between digitalization and macroeconomy on zakat collection in Indonesia

Aryadimas Suprayitno — 2025-10-02

Purpose – This study aims to investigate the long-term and short-term impacts of digitalization and macroeconomic factors on zakat collections in Indonesia. It explores and validates the successful use of the Internet and a country's economic conditions to maximize zakat collection.
Methodology – This study employs annual time series data from 1991 to 2024 to examine zakat collections in Indonesia, with digitalization and macroeconomic performance as the key exogenous variables. The selected period captures major economic disruptions, including the Asian Financial Crisis, 2008 global financial crisis, and post-pandemic recovery. The Autoregressive Distributed Lag (ARDL) model was applied to assess the long-short dynamic relationship effect among the variables.
Findings – This study addresses hypothesis by empirically confirms that the integration of digitalization and macroeconomic improvements plays a pivotal role in enhancing zakat collections in Indonesia. The findings reveal a favorable long-term and short-term impact of digitalization on zakat collection, and long-term positive effects and short-term negative effects of macroeconomic conditions.
Implications – This study provides critical insights for BAZNAS and other zakat institutions in designing and implementing sustainable digital strategy policies that enhance zakat mobilization and management efficiency. By integrating digital transformation initiatives with a forward-looking approach to future economic dynamics, zakat organizations can strengthen transparency and improve donor engagement.
Originality – This research presents a unique contribution by addressing the scarcity of studies on zakat collections that incorporate both long-term and short-term analyses. Furthermore, research incorporating macroeconomics and digitalization as external factors in the study of zakat remains limited.

Why are SMEs willing to pay trade zakat? Evidence from East Java, Indonesia

Ghifary Duyufur Rohman — 2025-10-02

Purpose – This study aims to identify and analyze the key determinants influencing small and medium-sized enterprises (SMEs) compliance with trade zakat obligations in East Java, where zakat collection from the SME sector remains relatively low despite its socioeconomic potential.
Methodology – This study adopts a quantitative approach utilizing Structural Equation Modelling (SEM) to analyze data collected through a structured questionnaire distributed to SME owners in East Java. In total, 171 valid responses were obtained. The six variables examined included entrepreneurs’ attitude, zakat literacy, role of zakat administrators, length of business, profitability, religiosity, and zakat.
Findings – The results show that zakat administrators have a significant positive influence on SMEs’ willingness to pay zakat, whereas religiosity, zakat literacy, and entrepreneurs’ attitudes do not significantly affect willingness to pay. Additionally, religiosity, zakat administrators, and length of business significantly affected zakat literacy among SME owners.
Implications – The findings highlight the strategic role of zakat administrators in promoting zakat compliance. Strengthening institutional roles and outreach programs can help increase zakat literacy and willingness to pay among SMEs, contributing to more effective zakat collection and socioeconomic development.
Originality – This study contributes to the limited empirical literature on trade zakat compliance among SMEs in Indonesia by examining institutional and behavioral factors using a structured SEM approach. This underscores the need to shift focus toward institutional effectiveness rather than solely on individual religiosity or awareness.

Examining financial well-being among students: Islamic social finance and theory of planned behavior approach

Siti Noraisyah Binti Norizan — 2025-03-05

Purpose – This study explores the interconnections between financial attitudes, subjective norm, perceived behavioral control, and Islamic social finance toward financial well-being. It examines how these factors contribute to financial stability, particularly within the context of Islamic finance.
Methodology – This study used a quantitative approach, and data analysis was conducted using SPSS 30. This study applied regression, correlation, and factor analyses to examine the relationships between the variables. Data were validated through reliability testing, normality assessments, and evaluations of construct validity to ensure methodological rigor and accuracy.
Findings – The results showed a significant relationship between attitudes, subjective norm, strong perceived behavioral control, and Islamic social finance toward financial well-being. These findings validated our hypotheses.
Implications – This study provides valuable insights for policymakers, financial institutions, and educators by highlighting the importance of fostering positive financial attitudes, enhancing financial self-efficacy, and promoting Islamic social finance practices. These findings can guide strategies to improve financial well-being across diverse socioeconomic groups.
Originality – This study contributes to the literature by providing a comprehensive analysis of how the theory of planned behavior and Islamic social finance collectively influence financial well-being.

Contribution of Islamic economy in achieving Sustainable Development Goals (SDGs)

Ade Nur Rohim — 2025-03-10

Purpose – This study aims to analyze the contribution of Islamic economics using various instruments to the achievement of Sustainable Development Goals (SDGs).
Methodology – This study uses a qualitative approach with a literature study approach, with reference to various studies.
Findings – This study found a close correlation and relevance between maqashid sharia as a goal of Islamic economics and the goals stated in the SDGs. In addition, it is concluded that the balance between commercial and social aspects in the Islamic economy is significant in sustainable development, which is manifested as a real contribution to the realization of the SDGs through the Islamic finance and banking sectors, as well as the Islamic social finance sector.
Implications – It is recommended that the government optimize the management of various Sharia economic instruments to accelerate the achievement of the SDGs.
Originality – This study emphasizes the suitability of the aim of the Islamic economic system to realize the achievement of the main maqashid sharia, namely maslahat, with the goals stated in the SDGs. It explores the contribution of the Islamic economic system in realizing sustainable development.

AI in Islamic finance: Global trends, ethical implications, and bibliometric insights

Muhammad Saeed Iqbal — 2025-03-10

Purpose – This study explores the integration of Artificial Intelligence (AI) in Islamic finance, analyzing global trends, ethical implications, and future research directions. The purpose is to assess AI’s role in enhancing Sharia compliance, regulatory adherence, and operational efficiency in Islamic financial institutions.
Methodology – Using a bibliometric analysis approach, this research examines publications from 2010 to 2023 indexed in Scopus and Web of Science. Keywords such as Islamic finance, "artificial intelligence, AI in finance, Sharia compliance, and globalization guided the search. Analytical tools, including VOSviewer and CiteSpace, were employed to visualize publication trends, citation networks, and influential research contributions from key countries like Pakistan, Malaysia, Turkey, Saudi Arabia, Indonesia, Qatar, Iran, and the UAE.
Findings – The research indicate that AI significantly enhances financial inclusion, risk assessment, compliance automation, and customer service in Islamic finance. Key research areas highlight AI-driven solutions for Sharia-compliant financial products, ethical considerations, and regulatory frameworks. However, limitations exist, as this study focuses only on English-language publications, potentially omitting critical insights from non-English sources.
Implications – This research contributes to the understanding of AI's role in Islamic finance, offering practical implications for financial institutions seeking to integrate AI for efficiency, transparency, and compliance.
Originality – It provides an original bibliometric perspective on AI applications in Islamic finance, underscoring the sector’s potential for innovation and sustainable growth in a globalized financial landscape.