Shahbaz Alam
Indian Centre for Islamic Finance

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Social and Environmental Contribution of Indonesian Baitul Maal wat Tamwil (BMT) to the SDGs Implementation Aminudin Ma'ruf; Tilla Ira Sellani; Lukmanul Hakim; Shahbaz Alam
Profetika: Jurnal Studi Islam Vol. 26 No. 01 (2025): Profetika Jurnal Studi Islam 2025
Publisher : Universitas Muhammadiyah Surakarta

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.23917/profetika.v26i01.8863

Abstract

Objective: This study aims to analyze the social and environmental contribution of Baitul Maal wat Tamwil (BMT) in Indonesia in supporting the implementation of SDGs in Indonesia. Theoretical framework: The underpinning theoretical framework of the study lies in the concept of Islamic economics with special reference to its social and environmental contributions. Literature review: The study's literature review provides the research development based on previous findings. It highlights the gap in the literature in the field of study, which needs to be addressed. Methods: The paper uses primary data that were obtained from in-depth interviews with 24 BMTs in several jurisdictions in Indonesia. A qualitative research method was used to explore and analyze BMTs' role thoroughly. Results: The results of this study inferred that BMTs in Indonesia have been actively contributing to society's social and environmental development. Their contributions are implemented through innovative programs tackling social and environmental issues. However, few BMTs contributed to one aspect but not the other and are expected to improve their contribution. This paper is unique from previous research with some recommendations and future implications. Implications: The study suggests some essential policy implications supporting the contributions of BMT in tackling the social and environmental issues in achieving the SDGs. Novelty: The research comes with new perspectives in the study of BMT towards SDGs implementation.
Sharia Finance, SDGs, and Economic Growth: Empirical Evidence from Muslim Countries in Asia Nisa Azzahro; Muthoifin; Shahbaz Alam
Profetika: Jurnal Studi Islam Vol. 25 No. 03 (2024): Profetika Jurnal Studi Islam 2024
Publisher : Universitas Muhammadiyah Surakarta

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.23917/profetika.v25i03.11986

Abstract

Objective: This study examines the role of Sharia finance in driving economic growth and supporting the achievement of the SDGs in Muslim countries in Asia. The main objective is to analyze the development, challenges, and contributions of Sharia financing systems, as well as to compare their performance with conventional financial systems in promoting economic growth, financial inclusion, and sustainability. Theoretical framework: The theoretical framework is grounded in Islamic financial principles that prohibit riba (usury), gharar (excessive uncertainty), and investment in haram sectors, while emphasizing social justice, risk-sharing, ethical investment, and inclusive development, which are closely aligned with the core objectives of the SDGs, particularly SDG 1, SDG 8, and SDG 10. Literature review: The literature review synthesizes previous studies on the development of Islamic finance in Malaysia, Indonesia, Brunei Darussalam, and Muslim regions of the Philippines, focusing on regulatory frameworks, levels of Islamic financial literacy, product innovation, and the sector’s contribution to regional economic growth and sustainable development. Methods: Methodologically, this study employs a descriptive and comparative literature-based approach, analyzing the implementation and evolution of Sharia and conventional financial systems across selected Asian Muslim countries, while identifying key challenges and opportunities in advancing SDG-oriented finance. Results: The findings reveal that Sharia finance has experienced significant growth in Asia, with Malaysia emerging as a global Islamic finance hub and Indonesia demonstrating substantial market potential. Despite this progress, challenges remain, including limited financial literacy, regulatory fragmentation, and the need for greater product and technological innovation. Empirical evidence suggests that Sharia finance contributes positively to financial inclusion, sustainable economic growth, financial stability, human capital development, and technological adoption, thereby reinforcing its relevance to SDG-driven development strategies. Implications: The study’s implications highlight the importance of strengthening Islamic financial literacy, harmonizing regulations, and encouraging innovation to position Sharia finance as a strategic pillar of sustainable and inclusive economic growth in Asia. Novelty: The novelty of this research lies in its comprehensive and integrative analysis of Sharia finance within an SDG framework, demonstrating its comparative advantages over conventional finance in fostering equitable and sustainable development.