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This research aims to examine the effects of financial inclusion in Islamic banking on economic development in Indonesia. The economic growth indicator is represented by the Industry Production Index (IPI) while the financial inclusion indicator is represented by the amount of Third Party Funds, the amount of financing, the number of Third Party Fu...
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Citations
... Several studies have highlighted the positive impact of Islamic banking on financial inclusion and economic growth (Adzimatinur & Manalu, 2021;Alhammadi, 2024;Hussein et al., 2024). Islamic banks, guided by Shariah principles, offer financing structures that emphasize risk-sharing and asset-backed transactions, thus aligning with sustainable development goals and reducing speculative activities (Anwar et al., 2020;Bany Issa et al., 2025;Ledhem & Mekidiche, 2022). ...
... Empirical studies have generally supported the view that Islamic finance contributes positively to economic growth. For instance, studies by Pertiwi et al. (2021) and Adzimatinur and Manalu (2021) reveal that Islamic bank financing has a significant impact on Indonesia's real sector development, particularly when third-party funds are efficiently mobilized. Alhammadi (2024) and Junaidi (2024) further emphasize that Islamic finance promotes sustainable development by enhancing financial inclusion, reducing inequality, and supporting ethical economic practices. ...
... Gani and Bahari (2019) emphasize that innovation in Islamic banking products can further attract deposits and stimulate financing, thus creating a virtuous cycle between financial intermediation and economic output. Islamic banks' ability to channel funds toward the productive sector also reinforces their role as economic catalysts (Adzimatinur & Manalu, 2021). This dimension is critical in a country like Indonesia, where bridging the financing gap for small and medium enterprises (SMEs) and infrastructure projects remains a policy priority. ...
Islamic banking plays an increasingly vital role in promoting inclusive and Sharia-compliant financial services amid economic expansion in Indonesia. This study aims to examine the moderating effect of the ratio of broad money (RBM), as an indicator of financial deepening, on the relationship between Gross Domestic Product (GDP) and Islamic bank financing. Employing a quantitative research design, this study utilizes secondary time-series data and applies moderated regression analysis (MRA) across three models to evaluate the direct and interactive effects of GDP and RBM on Islamic bank financing. The findings reveal that while GDP positively influences Islamic bank financing, the inclusion of RBM as a moderating variable significantly strengthens this relationship, as demonstrated by the significance of the interaction term in the third model. This indicates that financial deepening, reflected in a higher RBM, enhances the capacity of Islamic banks to channel funds into the real economy during periods of economic growth. The study emphasizes the strategic importance of managing broad money supply to support Islamic finance performance and broader macroeconomic goals. Theoretically, the findings contribute to the understanding of how monetary aggregates interact with Islamic financial systems, while practically, they inform policymakers and Islamic financial institutions about the need to align monetary policies with the growth of Islamic banking. Future research should consider additional macroeconomic factors and a broader institutional context to further refine these insights.
... Fitriyanto (2021) It also found that the financing of the sharia bank had a significant influence on the growth of the Indonesian economy through the development of UMKM. Adzimatinur & Manalu (2021) Islamic Financial Inclusion and Economic Growth….. 2890 growth in the long and short term. Anwar & Amri (2017) found that increased spread of shariah bank offices had a significant impact on the economic growth. ...
... This means that of each component of the Sharia finance inclusion that is being tested has a significant influence on economic growth. These findings are reinforced by the findings of Adzimatinur & Manalu (2021) which explain that Shariah financial inclusion has a significant and positive impact on economic growth. The probability value of Shariah's financial access is 0,0003 < α which means the significant impact on economic growth while the coefficient value is -0.106. ...
... Furthermore, Sharia principles that advance justice and balance in financial transactions can create a more stable and inclusive economic environment. This statement was reinforced by Ayyubi et al. (2017) dan Adzimatinur & Manalu (2021) which explained that Sharia bank financing can have a positive and significant impact on economic growth in Indonesia. ...
This study aims to analyze the impact of Islamic financial inclusion on economic growth in Indonesia for the period 2018-2022. The research method uses a quantitative approach by utilizing secondary data per province in Indonesia, which is a combination of time series and cross-section (Panel Data) obtained from the OJK and BPS websites. Data analysis was conducted using multiple linear regression analysis using Eviews 10 software. The results of the analysis show that simultaneously, Islamic financial inclusion has a significant impact on economic growth. Furthermore, partially, it was found that third-party funds and Islamic bank financing contributed positively to economic growth. Meanwhile, Islamic financial access shows a negative impact on economic growth in Indonesia for the period 2018-2022.
... Metaverse customer perspectives of a bank's dependability may be influenced by factors such as its adherence to faithbased principles, upright conduct, and management of customer relationships and grievances -all of which can impact their overall satisfaction and loyalty to the bank (Alarifi & Husain, 2023;Hidayat & Idrus, 2023;Nur et al., 2023;Wang et al., 2023). In the setting of Islamic banking, where customercenteredness and customized administration are striking, conveying top-notch administrations that meet customers' needs and desires is most extreme for cultivating fulfillment and devotion (Adzimatinur & Gloriman Manalu, 2021;Kaabachi & Obeid, 2016;Saeed et al., 2023;Wulandari et al., 2016). Customers' perspectives of a bank's administration quality might be impacted by elements, for example, the productivity of its forms, the ability of its staff, and the ease of its channels, all which can affect their general fulfillment and likelihood of proceeded patronage. ...
Islamic Shariah compliance plays a pivotal role in shaping customer satisfaction within Islamic banking institutions. However, in the environment of changing technological advancements, the banking industry has entered a new era of metaverse technology. In this case, the customer satisfaction in perspective of Islam is not easy to achieve. Therefore, this study is an attempt to examine the role of Islamic Shariah compliance in customer satisfaction while using metaverse technology in Chinese Islamic banking industry. For this purpose, this study collected data from customers and employees working in Islamic banking industry. The questionnaire was designed for data collected. Questionnaires were distributed by using simple random sampling and 649 questionnaires were returned. It is observed from the results that Islamic Shariah principles govern many aspects of banking operations from financial transactions and investment practices to ethical standards. These Shariah principles have vital importance for customer satisfaction while using metaverse technology. Islamic Shariah principles have positive role to enhance perceived service quality and customer satisfaction. Therefore, banking industry should strengthen Islamic Shariah principles for the implementation of metaverse technology.
... Articles discussing economic growth models in Indonesia mostly use stochastic models, especially time series models, including vector autoregressive (VAR) models [44][45][46][47], autoregressive distributed lag (ARDL) [48][49][50][51][52][53], error correction models (ECMs) [54][55][56][57][58], and vector error correction models (VECMs) [59][60][61][62][63]. Time series models are usually chosen because economic data include observations of variables at certain time intervals. ...
Economic growth modeling is one of the methods a government can use to formulate appropriate economic policies to improve the prosperity of its people. Differential equations and stochastic models play a major role in studying economic growth. This article aims to conduct a literature review on the use of differential equations in relation to stochastics to model economic growth. In addition, this article also discusses the use of differential and stochastic equations in economic growth models in Indonesia. This study involves searching for and selecting articles to obtain a collection of research works relevant to the application of differential and stochastic equations to economic growth models, supported by bibliometric analysis. The results of this literature review show that there is still little research discussing economic growth models using differential equations combined with stochastic models, especially those applied in Indonesia. While the application of these models remains relatively limited, their potential to offer deeper insights into the complex dynamics of economic growth is undeniable. By further developing and refining these models, we can gain a more comprehensive understanding of the factors driving growth and the potential implications of various economic policies. This will ultimately equip policy-makers with a more powerful analytical tool for making informed decisions.
... Based on the categorizing of the World Bank's Global Financial Development Database, we choose variables for DFI indicators. The industrial production index is the dependent variable of the study, which was also used by Adzimatinur and Manalu (2021). The independent variables are as follows: ...
Purpose
The purpose of the study is to find out the impact of Digital Financial Inclusion (DFI) on economic growth [(Industrial Production Index (INDP)] of Bangladesh.
Design/methodology/approach
Using the monthly data over the period 2018 M12 to 2021 M12, this study applied the Auto-regressive Distributed Lag (ARDL) model to assess the effect of DFI indicators on INDP. The secondary data was collected from the Bangladesh Bank and CEIC Global Economic Data.
Findings
The study found that the majority of DFI indicators are positively associated with INDP. From the short-run ARDL, it is seen that one unit positive increase in Point of Sales Transactions (POST) can increase the INDP by 0.055 units. From the long-run ARDL, it is seen that POST and e-commerce transactions (ECOMT) have a significant positive impact, while Automated Teller Machine Transactions (ATMT) have a significant negative effect on INDP. One unit increase in POST and ECOMT increases INDP by 0.13544 and 0.11611 units, respectively.
Research limitations/implications
During the era of the fourth industrial revolution, the findings will be beneficial for policymakers, financial technology service providers, manufacturers, consumers, corporations and investors as they pave the way for a more inclusive approach to financial transactions for economic growth.
Originality/value
The study’s novelty is that it explored the influential DFI indicators and shed light on both short-run and long-run relationships between the indicators and macro-economy from the context of a developing nation.
Peer review
The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-04-2023-0306
... Islamic principles, such as the prohibition of interest, play a crucial role in driving economic development (Iqbal & Mirakhor, 2013). The financial inclusion of Islamic banking in Indonesia positively affects economic growth (Adzimatinur & Manalu, 2021). The banking system plays a critical role in a country's economic growth by facilitating the flow of funds and supporting investment activities. ...
Fiat money based financial system has disturbed the balance between household demand and firm supply. Further, government monetary intervention to curb inflationary demand is hurting production via the cost of capital and disturbing the functionality of the financial system in terms of capital market misallocation. These aspects are trickling down to cause social disturbance in the economy. Corresponding to it, the gold standard or at least assets-based money promotes social inclusion, empowers marginalized communities, and addresses socio-economic challenges by using tangible assets as a monetary system. The study explores assets-based money’s theoretical foundations, distinguishing it from traditional debt-based models and its potential benefits on social inclusion. It analyzes potential benefits, challenges, and limitations in implementing assets-based money systems. Several empirical studies explored debit cases of Islamic and conventional finance sectors, but this study examines the high power money and social inclusion in the economy. For this determination, the quantitative research approach consisted of selected 143 countries panel data of conventional and Islamic financial statements from 1960-2022. The model contains regression estimates, descriptive analysis, and correlation coefficient analysis. The assets-based money boosts living standards and positively impacts poverty reduction. This money reduces the inflationary effects of monetary expansion, hurting the purchasing power of low-income groups. Further, it is expected to have a growth-promoting effect via risk sharing and resource distribution. Assets-based money can support economic growth, financial stability, and inclusive development through a well-designed implementation strategy, but success depends on thorough research and analysis.
... A healthy financial system is one of the variables that fosters economic growth (Umar, 2017). Financial institutions' intermediation function is one of the keys to achieving financial system stability, income equality, and economic growth (Adzimatinur & Manalu, 2021). Consequently, the primary values of Islam place a high value on social justice, inclusivity, and the equitable allocation of resources between rich and poor. ...
Introduction: Stability in the financial system is a component that can stimulate economic expansion. However, this cannot be accomplished if only a minority of the population has access to the financial system's intermediation function. This may be due to a lack of access, information, or even public awareness of the use of financial services. The objective of this study is to ascertain the extent of inclusivity in East Kalimantan and examine how it influences the region's economic development. Therefore, financial inclusion plays a crucial role in fostering economic expansion by establishing stable financial conditions. Research Methods: The Vector Error Correction Model is applied to analyze data obtained from Sharia Banking Statistics (SPS OJK) and Central Statistics Agency (BPS) publications, in addition to other corroborating sources, for the purpose of this quantitative study. Results: The research findings indicate that the degree of Islamic financial inclusion in East Kalimantan was low in 2017 and 2018, but reached a high level in 2019, 2020, and 2021. Conclusion: The immediate impact of Islamic financial inclusion on economic growth in East Kalimantan is substantial. Nevertheless, over the 2017-2021 period, there is no substantial impact on the level of Islamic financial inclusion and economic growth in East Kalimantan in the long run.
... Financial inclusion has been found to have a positive correlation with business performance, indicating that increased access to finance can enhance microenterprise productivity and innovation [12]. In the Indonesian context, the accessibility of microenterprises to financial services has implications for their sustainability and expansion [13]. ...
In the context of Indonesian microenterprises, this study explores the complex interactions among financial inclusion, business ethics, innovation, and Islamic ethics-based leadership. The study uses a sample of 175 microenterprise owners and managers to investigate the structural links among these factors using a quantitative approach. The results show that Islamic ethics-based leadership, financial inclusion, innovation, and business ethics are significantly and favorably correlated. Innovation has a substantial positive link with Islamic Ethics-Based Leadership, whereas Business Ethics and Financial Inclusion show modest positive relationships. The study's findings advance knowledge of the variables impacting moral leadership in Indonesian microenterprises and have applications for managers and legislators who want to promote moral corporate conduct in the context of Islam.
... As indicated by third-party funds and financing in Islamic banking, an increase in Islamic financial services will increase human welfare. Adzimatinur & Manalu (2021) researched to analyze the effect of Islamic banking financial inclusion on economic growth in Indonesia, Iramayasari & Adry (2020) analyzed the effect of Islamic banking financial inclusion on economic growth in ASEAN, Kim, Yu, & Hassan (2018) analyzed financial inclusion on economic growth in the Organization of the Islamic Conference (OIC) countries. The results of their research show that financial inclusion has a significant positive effect on economic growth. ...
... Financial inclusion affects a country's economic growth (Adzimatinur & Manalu, 2021;Iramayasari & Adry, 2020;Kim et al., 2018). Thus, increasing financial inclusion must continue to be encouraged to increase the country's economic growth, including increasing the inclusion of Islamic finance in Islamic boarding schools. ...
This study aims to determine the index of Islamic financial literacy and inclusion in Islamic boarding schools with a case study at RMI NU DKI Jakarta and analyze the effect of Islamic financial literacy and inclusion on welfare proxied by Maqashid Sharia. Primary data analyzed with descriptive statistics to measure the Islamic financial literacy and inclusion index; and SEM-PLS to analyze the effect of Islamic financial literacy and inclusion on welfare proxied by Maqashid Sharia. The results showed that 34% of respondents had Islamic financial literacy and inclusion index well-literate, 57% in sufficient literate, and 9% in less literate. Islamic financial literacy has a significant positive effect on welfare proxied by Maqashid Sharia. Meanwhile, Islamic financial inclusion has a positive but insignificant effect. The government and Islamic financial institutions must increase the socialization of Islamic financial literacy in Islamic boarding schools and increase access to finance by adequate supporting infrastructure.
... Central Banks directly control/monitor local payment flows and reduce transaction costs. Most NPSs are owned or directly controlled by the Central Banks [11,12]. ...
National Payment Switches (NPSs) and International Payment Switches (IPSs), including major players such as SWIFT, Mastercard, and CHIPS, have become vital to the financial infrastructure, facilitating secure and efficient transactions among local financial institutions. Nonetheless, the growing adoption of digital payments has heightened the risk of financial fraud. Consequently, NPSs, under the direct ownership of Central Banks (CBs), are increasingly adopting advanced technologies, such as cognitive computing, to bolster their fraud detection capabilities in their respective countries. This article delves into the role of cognitive computing in detecting financial fraud within NPSs. It examines the advantages of cognitive computing in recognising patterns of fraudulent behaviour and analysing vast amounts of data. Additionally, the study highlights the importance of focusing on how cognitive computing can augment traditional fraud detection methods, such as rule-based systems and data analytics. Nineteen real-world cases from eighteen countries are analysed, exploring the cognitive computing tools employed by NPSs to identify fraudulent transactions. The challenges and limitations of implementing cognitive computing in fraud detection and potential solutions to address these issues are identified. The primary assumption that cognitive computing is crucial for detecting financial fraud in NPSs is substantiated. Its ability to analyse large datasets and pinpoint patterns of fraudulent behaviour proves invaluable for financial institutions seeking to protect themselves against financial fraud in a progressively digital world. The conclusions drawn from the overview of the cases aim to identify best practices, potentially trigger new benchmarking standards, and facilitate the development of integrated cross-border solutions to combat financial fraud on a global scale effectively. The purpose of this research is to examine the role of cognitive computing in detecting financial fraud within NPSs, identify its advantages, challenges and limitations, and provide real-world case examples.
