Islamic Financial Instruments Research Articles

Clustering Research on Islamic Empowerment Model using R

This bibliometric research was conducted to provide a more in-depth picture of the "Islamic Empowerment Model" by analyzing a number of relevant articles that have been published in the Dimensions database. A total of 233 imlia publication documents in the period 2022-2023 became the object of this research. Using bibliometric analysis methods with the help of Biblioshiny-R software, this study seeks to reveal publication trends over time, identify the most prolific authors in this field, explore journals that have a significant impact in related literature, and reveal the main themes that consistently appear in these scientific works. The results show that the number of publications has increased significantly since 2016, reaching a maximum of 52 publications in 2021 and 2022. 2011 was the year with the highest average number of citations throughout the observation period. The Journal of Social Science Research, is the top publishing journal. There are several authors associated with this journal, such as Huda N, Alhifni A, and Ahwarumi B. The next important finding is that there are 3 research clusters including, Islamic empowerment models through Islamic financial instruments, women's empowerment models in Islam, and Islamic empowerment models through pesantren education. The results of this study are expected to provide valuable insights for various parties, including researchers who want to better understand the development of Islamic empowerment literature, practitioners involved in this field, and academics who want to explore this topic in more depth.

Determinants that Influence the Decision of Nazhir in Investing in the Sharia Capital Market

The Islamic capital market is one of the Islamic financial instruments, the development of the Islamic capital market is quite good in Indonesia, but investors from nazir waqf have not been very active in investing in the Islamic capital market. The purpose of this study was to examine the effect of the variables knowledge, motivation, and minimum capital on investment on the Nazhir Decision variable in developing waqf assets in the Islamic capital market. The research object is Islamic capital market while the population is Islamic capital market Nazir, the sampling technique uses random sampling technique of 140 respondents. Collective data used a questionnaire using a Linkert scale with a scale of 1 to 5. The data analysis technique used a structural equation model (SEM) with SmartPLS software. The results of the study prove that the independent variable Islamic knowledge has a significant effect on the decision to invest in the Islamic capital market. The minimum capital deposit has a significant and positive influence on Nazir's decision to invest in the Islamic and variable capital markets. The motivational variable has no significant effect on Nazir's decision to invest in the Islamic capital market

Islamic finance as a driver for enhancing economic sustainability and innovation in the GCC

Purpose This study aims to investigate the role of Islamic finance in supporting sustainable economic growth, innovation and digital transformation in the Gulf Cooperation Council (GCC) region. Amid global challenges like the Russia–Ukraine conflict and COVID-19, the focus extends beyond the GCC’s oil dependency to explore how Islamic finance can enable technological advancements and foster a digitally innovative economy. The research aims to reveal the potential of Islamic finance in driving economic diversification, technological progress and sustainable development in the GCC. Design/methodology/approach Using a content analysis approach, this study critically examines the economic repercussions of recent global crises, shedding light on how Islamic finance contributes to socio-economic justice and the provision of social goods in the GCC. The research synthesises findings from various secondary sources, including academic literature, reports and industry standards, to analyse Islamic finance’s role from an ethical and strategic perspective within the GCC’s evolving economic landscape. Findings The findings reveal Islamic finance’s potential to significantly contribute to the GCC’s economic diversification and resilience against global economic downturns. The study highlights how Islamic finance aligns with the sustainable development goals and its effectiveness in promoting ethical financial practices and socio-economic justice. Research limitations/implications Future research should focus on global comparative studies to understand Islamic finance’s impact on sustainable development beyond the GCC. Longitudinal studies are also essential to assess the long-term effects of Islamic financial instruments on economic stability. Practical implications The research advocates for incorporating Islamic finance principles into the GCC’s economic strategies, emphasising its role in providing resilient and ethical financial alternatives conducive to sustainable development. It underscores the need for policy initiatives integrating Islamic finance to bolster socio-economic welfare and environmental sustainability. Originality/value Offering a novel perspective, this paper enriches the discourse on the contribution of Islamic finance to sustainable economic development. It presents critical insights into how Islamic finance can underpin long-term economic resilience and growth in the GCC. It provides valuable implications for academia and policymaking, particularly in emerging economies’ science and technology policy management.

The Urgency of Optimizing Productive Waqf in Pesantren to Foster the Halal Industry Development

Indonesia rates fourth out of the top 15 countries in the global Islamic economic indicator nomination for the State of the Global Islamic Economy Report 2022. As the country with the largest Muslim population in the world, Indonesia has the potential to develop its halal industry. Islamic financial instruments, such as waqf, are vital to the halal industry. Many countries, including Indonesia, have demonstrated the effectiveness of employing productive waqf in Pesantren to provide financial support for education. With 37,614 Pesantren in Indonesia, these institutions can stimulate local economies through productive waqf and business ventures that correlate with local geographies and emerging potential, such as using waqf for capital business or Pesantren business units. Therefore, the economic growth in Pesantren positively affects the halal industry. However, several obstacles impede the development of a productive waqf in Pesantren, resulting in suboptimal performance. This study examines strategies to optimize productive waqf implementation in Pesantren to support the halal industry and strengthen the economy. This library-based study employs a descriptive methodology to collect data on literacy, which is then subjected to content analysis or other forms of scientific analysis. This study identified strategies to overcome obstacles in waqf management to establish a productive waqf in Pesantren and positively influence the development of the halal industry in Indonesia.
 Keywords: productive Waqf, Pesantren, halal industry

Investigating the applicability of the expected credit loss model to Islamic Sukuk: Law aspects

This paper examines the application of the expected credit loss (ECL) model under International Financial Reporting Standards (IFRS) 9 to Islamic Sukuk, which indicates that accountants do not regard any gap between Islamic financial instruments and IFRS. Since Sukuk have special features according to Islamic finance, such as the non-usage of interest (riba) and risk-sharing, this paper reviews the issues and possible modifications that may be required for their compliance with both Sharia and international accounting standards. Applying a mixed-methods approach, 30 experts in Islamic finance and accounting were interviewed for qualitative perceptions, while the data were supplemented by a survey of 182 stakeholders in the Islamic finance sector. The results tend to indicate that the ECL model is consistent with Sharia rules and substantially improves risk management under Islamic finance without adversely affecting Sharia compliance, especially in the case of Sukuk (Paltrinieri et al., 2023; Uluyol, 2021). However, the operational challenges of the non-interest-based nature and diverse structures of Sukuk obviously require customized approaches when applying the ECL model. This research is hence relevant and contributes valuable practical considerations to the literature for policymakers and practitioners in Islamic finance and accounting toward aligning Islamic financial products with international standards (Adelopo et al., 2023).

Highlighting Factors Influencing Financial Innovation

Objective: The objective of this research is to examine the factors influencing financial innovation in companies operating within the capital market. Methodology: The study employs a structural equation modeling (SEM) approach to test the hypothesized relationships. Data were collected through questionnaires from a sample of 70 experts in the field. Confirmatory factor analysis (CFA) was used to validate the constructs, and the model was assessed for fit and reliability using various indices such as Average Variance Extracted (AVE), Cronbach's alpha, and Composite Reliability (CR). Findings: The results indicate that all proposed paths are significant. Causal conditions are found to have a meaningful relationship with financial innovation through financial development phases, liquidity creation, risk management tools, and other factors. The central phenomenon significantly impacts contextual conditions such as GDP growth, regulatory changes, and organizational creativity. Additionally, intervening conditions (risk coverage, commodity-based financing) and strategies (use of Islamic financial instruments, management capability) also significantly influence contextual conditions. Lastly, contextual conditions have a significant effect on the outcomes, including social trust and financial performance. Conclusion: The study concludes that the identified factors significantly influence financial innovation in the capital market. These findings are consistent with previous research, particularly aligning with the results of Abdullah et al. (2022). The research highlights the importance of understanding the relationships between these factors to foster financial innovation effectively.

Ethnomethodology Approach in Investment Decision Making in Islamic Capital Market: An Interaction and Social Practice of Market Participants

This study aims to investigate and analyze social interactions and social practices underlying investment decision-making in the Islamic capital market. The research focus includes an understanding of how Islamic values are reflected in the interaction of market participants, the communication practices used, and the impact of social context on investment decision-making. This research uses qualitative methods with an ethnomethodological approach through participatory observation, in-depth interviews, and document analysis. Researchers are involved in the daily activities of market participants, whether on the stock exchange, Islamic finance seminars, or investment forums. In-depth interviews were conducted with investors, brokers, and Islamic finance experts to gain a more in-depth perspective. The document analysis includes a study of Islamic finance literature, fatwas, and related documents. The results showed that social interaction and social practices of market participants have a significant role in making investment decisions in the Islamic capital market. Communication practices based on Islamic values play a key role in the decision-making process. The social and cultural context also influences investors’ perceptions and preferences towards Islamic financial instruments. These findings provide deep contextual insights into the factors influencing investment decisions in Islamic capital markets, which can be the foundation for the development of Islamic ethics-based investment strategies.

The Role of Sharia Financial Innovation and Literacy in Improving the Performance of MSME Actors

This study aims to analyze the role of innovation and Islamic financial literacy in improving the performance of MSME actors in the context of Islamic economics. This study also aims to evaluate the impact of innovation and Islamic financial literacy on MSME growth and contribute to the sustainable development of MSMEs. This qualitative research applied a literature approach and document analysis to collect relevant data and information. A literature review was also conducted to identify indicators of the success of Islamic financial innovation and literacy in MSMEs and appropriate evaluation methods. Other research data included previous research results and related case studies. The results of this study revealed that MSMEs that implement Islamic financial innovation and literacy tend to experience improved performance. Product and process innovation, selection of Islamic financial instruments, and financial management by Sharia principles contributed positively to increasing MSME income, productivity, and operational efficiency. This research contributes to understanding the critical role of innovation and Islamic financial literacy in improving the performance of MSME actors. The findings of this study can serve as a reference for relevant stakeholders, including MSME actors, government, and Islamic financial institutions, in developing supporting policies and programs that strengthen innovation and Islamic financial literacy in MSMEs.

The Use of Social Media in Improving Investment Literacy in Islamic Mutual Funds

Reksadana Syariah are a forum for raising public funds which are managed by a legal entity called an Investment Manager, to then be invested in securities such as: stocks, bonds and money market instruments in accordance with the provisions and principles of Islamic sharia, including a portfolio of fund placements. in Islamic financial instruments such as Islamic stocks and sukuk. Islamic mutual funds can only invest in financial securities that are in accordance with sharia rules and principles, and of course they are still bound by investment restrictions set by the OJK. Securities that are classified as sharia are included in the List of Sharia Securities issued by OJK. Reksadana Syariah are still bound by Islamic Sharia rules which are based on the Koran. Reksadana Syariah have a supervisor called the Sharia supervisory board whose job is to supervise, provide advice, give consideration to the use of social funds, as well as education, promotion and product development. The community itself is not very familiar with what exactly Reksadana Syariah are and the rules contained therein. In this journal it can be seen how Reksadana Syariah are managed in accordance with existing rules.

The role of zakat in economic recovery during and after the Covid-19 pandemic: A case study of Baznas in Indonesia

The Covid-19 pandemic has had a significant impact on the global economy, including Indonesia, which experienced a drastic economic decline. Baznas is expected to contribute to economic recovery through the management and distribution of zakat, infāq, and ṣadaqah (ZIS) funds. This study aims to evaluate the role of Baznas in supporting Indonesia’s economic recovery during and after the Covid-19 pandemic and to analyze the economic recovery methods implemented by Baznas. This research employs a qualitative approach with content analysis and literature review methods. Secondary data were obtained from Baznas activity reports, financial reports, and management reports from 2020 to 2022, sourced from the official Baznas website. The findings indicate that Baznas has effectively managed and distributed ZIS funds to assist communities affected by the pandemic. Various programs, including health, social, economic, and educational assistance, were implemented to mitigate the negative impacts of the pandemic. The distribution of ZIS funds was focused on both consumptive and productive schemes, with a greater emphasis on consumptive schemes during the pandemic. This study demonstrates that zakat, as an Islamic financial instrument, can be a solution to alleviate the economic burden on communities affected by Covid-19.Keywords: Baznas; Covid-19; economic recovery; zakat, infāq, and sadaqah (ZIS).

Reconstruction of the Practice of Siyasa Syar'iyyah During the Islamic Empire's Relevance to the Practice of Sharia Financing CWLS Retail in Indonesia

The purpose of this study is to analyze the reconstruction of Islamic sharia implementation policies during the Islamic Empire in Indonesia from the perspective of siyasah syar'iyyah and their relevance to Indonesian government policies in regulating Islamic financing instruments in Cash Waqf Linked Retail Sukuk (CWLS Retail). The statutory approach and descriptive analysis are used in this research. Sources of data were obtained from various literary materials both from books, journals and the internet, as well as other relevant sources regarding the politics of Islamic law (siyasah syar'iyyah) during the Islamic period and its relevance to the regulation of Islamic financing instruments in Indonesia, especially with regard to the application of retail sukuk cash waqf (CWLS Retail). The results of the study show that first, the political application of Islamic law during the Islamic empire in Indonesia was carried out through the politics of the king's power (ruler). Second, the application of political Islamic law has relevance to current Indonesian government policies, namely in regulating Islamic financing instruments for Cash Linked Retail Sukuk (CWLS Retail), where the Government through various Islamic policies is embodied through laws, government regulations, MUI Fatwa, and other regulations. However, implementing this policy requires 6 variables of Islamic politics (siyasah syar'iyyah) in the opinion of Ibn Khaldun, namely mutual synergy between law, government, society, economy, development and justice.

Optimizing Hajj Fund Management through Strategic Asset Allocation in Islamic Finance Instrument

The management of Hajj funds must be done effectively using a rigorous standardized risk management approach. This study aims to create a Hajj fund management model using Islamic financial instruments through the optimal portfolio method and strategic asset allocation. The model was built using historical data from 2010–2022, involving Islamic deposits, government sukuk (SBSN), corporate sukuk, and Islamic stocks, which were analyzed with the Markowitz portfolio equation in Excel Solver. The result showed that the optimal portfolio yields an 8.50% expected return with a 4.00% risk; strategic asset allocation produces an 8.25% return with a 2.99% risk. The policy implication of this research is the need to review the initial deposit of pilgrims and explore alternative investments to bridge the gap between the actual cost of Hajj and pilgrims' payments while improving returns.JEL Classification: M31, M37, L92 How to Cite:Masruroh, A., Rodoni, A., & Pontjowinoto, I. P. (2023). Optimizing Hajj Fund Management through Islamic Finance Instrument. Signifikan: Jurnal Ilmu Ekonomi, 12(2), 287-306. https://doi.org/10.15408/sjie.v12i2.34403.

WAQF-BASED HEALTHCARE SERVICES MODEL(WHS-M)

Health is regarded as the core of a nation's existence. Its absence can create discord for the individual and society as a whole. Recent phenomena of the COVID-19 pandemic outbreak, which has infiltrated the lives of the masses, have wreaked havoc on the health and well-being of people worldwide. Undoubtedly, the absence of health can generate a magnetic field that attracts an abundance of funds to mitigate or treat this pandemic and other emerging diseases. This is partially due to the inextricable relationship between wealth and health. This paper focuses on how the integration between Islamic finance instruments, namely waqf and sukuk, can develop the health and well-being of individuals by proposing a new model (WSMHS). In addition, this study is conceptual, which needs further investigations using more sophisticated qualitative and/or quantitative methods.

Enabling beneficial right for sovereign ṣukūk issuance in Indonesia: challenges and analysis

PurposeThis study aims to investigate beneficial right as a new legal concept and term accepted by the Indonesian legal system. The new concept was ratified to endorse government decision to use ṣukūk (as an Islamic financial instrument) in the financing of state budget deficit. Some legal issues emerged after the ratification such as the necessity to synchronize the beneficial right with other property rights in Indonesia and the disharmony between laws related to sovereign ṣukūk issuance.Design/methodology/approachThe study uses a qualitative method with library study and interviews with relevant legal experts in Indonesia as the data collection techniques.FindingsThe findings show that the passage of Sovereign Ṣukūk Law 2008 that ratified beneficial right deemed as a concession point by the government to solve conflicts between legal restriction and employment of state-owned assets as the underlying asset of sovereign ṣukūk. The study deemed the necessity to improve the use of beneficial right in the Indonesian legal system which by the concept is not exercised for the issuance of sovereign ṣukūk only. There is the need to harmonize the administration of this right with other property rights in Indonesia.Research limitations/implicationsThe scope of study will be limited to the Indonesian regulation related to the use of beneficial right concept in the issuance of sovereign ṣukūk in Indonesia. The regulation as mentioned will be in the form of statutes, presidential or ministerial regulations, and also opinions of Indonesian legal and sharīʿah scholars regarding the matter.Originality/valueThis study may explore significantly the use of beneficial right for the issuance of sovereign ṣukūk by the Government of Indonesia. Specifically, the study reveals and addresses the issues that are following the ratification of beneficial rights originated from the common law system into the Indonesian civil law system.

Cash Waqf Linked Sukuk for Islamic Social Welfare and National Development: Evidence from Indonesia

This article aims to study Indonesia’s experience in issuing Cash Waqf Linked Sukuk (CWLS), the schemes and legality which are meant for Islamic social welfare improvement, and CWLS’ contribution to the national development. It is the development of a conceptual paper that explores and carefully reviews regulations, relevant literature studies, reports, and official documents published on the internet. The findings showed that Indonesia has successfully formulated and issued two instruments for integrating cash waqf with the State Sukuk: the CWLS and Retail CWLS. These instruments involve six state institutions and eight central socio-religious institutions that act as formulation, implementation, and supervision. Both instruments are not only beneficial for Islamic social welfare, but they also contribute to the national development. The authors argue that the innovation of Islamic financial instruments can empower the Islamic social welfare and contribute to the national development. It contributes to the discourse on cash waqf innovations in State Sukuk which studies Indonesia’s experiences. This evidence from Indonesia can be adopted and applied by other countries that have fiscal limitations for the empowerment of Islamic social welfare, and at the same time contribute to the national development.

Analisis Faktor-Faktor Yang Mempengaruhi Penggunaan QRIS Sebagai Alat Pembayaran Keuangan Syariah di Sumatera Utara

The ever-increasing use of QRIS payment technology in not only used for general payment transactions. However, Islamic financial payments made by Muslims can also be made using QRIS. QRIS is now easy to find anywhere, including mosques, ZIS (Zakat, Infaq, Alms) collection institutions. The aim of the research is to analyze the factors of using QRIS payment technology for Islamic finance in the province of North Sumatra. The research theory uses the TAM theory (Technology Acceptance Model) with 5 variabels, namely: perceived usefulness, perceived ease of use, attitude toward using, behavior intention to use, actual use. The research method uses a quantitative approach, combining two sampling techniques, namely: purposive sampling and simple random sampling, SEM (Structural Equation Modelling) analysis method. Data collection using a google form questionnaire. The results of the analysis show that the variable erceived ease of use with a t-statistic value of 2,123 (p=0,034) is stated to have a positive and significant effect then the actual use variable also has a positive and significant effect with a t-statistic value of 2,893 (p=0,004) on QRIS Islamic financial payment instruments.

Islamic Financial Instruments and its Impact on the Return On Sales: Al-Hajj Savings and Investment Fund of Jordan as a Model

Purpose: This study intended to investigate and analyze the relationship between deposits, money, real estate, stocks, and other gains and the return on sales at Al-Hajj Savings and Investment Fund of Jordan. Theoretical framework: Quantitative techniques were tested by looking at the financial statements for the time period (2015 -2020). Design/methodology/approach: the unit of measurement for this study is the Jordanian Hajj Provident and Investment Fund. In this study, there are differences between Islamic financial instruments. This study will be practical in nature, and illustrative in terms of purpose, which requires the use of causal and correlative relationships for this study. Findings: Results showed that there is a significant statistical effect of deposit Profits on the return on sales, with a calculated T value of (6.765851) and a significance level less than 0.05. Additionally, the table's results indicated that (88.4%) of the change in "return on sales" can be explained by the change in the independent variable. Also, there is a significant statistical effect of finance Profits on the return on sales with a calculated T value of (2.871897) and less than 0.05. Additionally, the table's results indicated that 57.8% of the change in "return on sales" can be explained by the change in the independent variable. The results also revealed that (58.9 %) of the change in "return on sales" can be explained by the independent variable “Real State Profits” dimension. Finally, the result showed that there is a significant statistical effect of real state Profits on the return on sales with a calculated T value was (4.717416), with a significance level of less than 0.05, the table also showed that (81.6%) of the change in “return on sales” can be explained by the change in the “Stocks Profits” dimension. Research, Practical & Social implications: The research indicated that in order to regulate Islamic finance instruments, one must adhere to the requirements of Islamic Sharia and implement the prescribed controls. Additionally, work to establish the necessary legal framework in Islamic nations so that Islamic financing instruments can be regulated and controlled at all stages and that they are not restricted to just one type. Originality/value: The findings suggest several consequences forth fields of Islamic Financial Instruments and Al-Hajj Savings Investment Fund. Additionally, the Arab and Islamic country, including Jordan, have had a number of financial issues that this study helps to resolve. Al-Hajj costs of the participants are financed from their savings and profits, and if the savings exceed the costs of the Hajj, the participant can withdraw his savings and profits after performing the mandatory duty.

Analisis Kontribusi Wakaf antara Indonesia dan Malaysia dalam Meningkatkan Pemberdayaan Ekonomi Ummat

Wahyu Syarvina
 Universitas Islam Negeri Sumatera Utara
 , wahyusyarvina@uinsu.ac.id3
 
 
 ABSTRACT.
 Waqf is one of the Islamic financial instruments that can be empowered to help the ummah's economy, starting to become one of the drivers of helping the economy in the country. because it is not an obligation for a Muslim like zakat, giving rise to various efforts made to collect and distribute waqf so that it can contribute properly. Indonesia and Malaysia, which are two neighboring countries, are the case studies in this study. To see a comparison of the funds raised, a comparative study is a method for analyzing comparisons between the two countries. By collecting data through the library, online sources of scientific publications through the Dompet Dhuafa website and the Malaysian Waqf Foundation, it is also followed by previous studies. It was found that the results of the funds collected were increasing, and the productive empowerment of waqf really helped the community.
 Keywords: waqf; empowerment; ummah; indonesia; malaysia

PROGRESIVITAS PENGELOLAAN DAN PENGEMBANGAN WAKAF UANG DI INDONESIA

In comparison to other Islamic nations, Indonesia has a very high cash waqf potential because the majority of its citizens are Muslims. Waqf is a way of goodness in Islam and has numerous virtues, hence it has a huge potential for growth. Indonesians are still competing to donate their best assets for waqf for both social and religious reasons. The large potential of the waqf must be followed by good management and development as well. This research uses descriptive analytical method with a qualitative approach. The findings of this study indicate that the potential for cash waqf will continue to increase along with the number of Indonesian Muslim population which is estimated to reach 237.56 million people, and to maximize the potential for cash waqf can be done by investing waqf funds in LKS products and/or Islamic financial instruments . Then the distribution of the profits from the cash waqf will be distributed toexcuse me This can be done with direct community development and empowerment programs managed by Nazhir waqf. or it can also be distribution of profits from cash waqf investments by carrying out community development and empowerment programs through partnerships with other empowerment institutions that meet institutional and professional eligibility criteriaKeywords : Cash Waqf, Nazhir, Development

Islamic Social Fund (Zakah Infaq Shodaqoh), Inflation, and Poverty Alleviation in Surabaya City

This study analyzes the poverty rate in Surabaya in 2016-2020 which is supported by Islamic financial instruments and macroeconomic instruments. This study aims to examine the effect of receipt ZIS funds and inflation on the poverty rate in Surabaya in 2016-2020. This study used quantitative approach with multiple linear regression tests which were processed using the Eviews 10 program. The data used is time series data with the period of this study from January 2016 to December 2020. The data source was obtained from the East Java National Amil Zakat Agency (BAZNAS) and the Central Statistics (BPS) Surabaya City. The results of this study are indicating that the ZIS variable has a significant effect with a probability value of 0.0000 and has a negative direction with a coefficient value of -0.212219. This explains that the receipt of ZIS funds at BAZNAS East Java can reduce the number of poor people from 2016 to 2020. Meanwhile, the inflation variable has no significant effect on poverty with a probability value of 0.8062, and has a negative direction with a coefficient value of -0.006093. This happened because the inflation rate which was still fluctuating had no effect on the poverty rate in Surabaya from 2016 to 2020. Then simultaneously the ZIS variables and inflation together had an effect on the poverty rate in Surabaya in 2016-2020. While the results of the R2 test in this study indicate that the poverty rate in Surabaya is explained by the ZIS variable and inflation of 40.53% and the rest is explained by other variables outside the variables examined in this study.