<![CDATA[This study examines the role of Islamic microfinance as a catalyst for rural financial transformation through a case study of BMT Wuluhan Jember, Indonesia. The research addresses the persistent dependence of rural communities on informal lending practices, which often expose borrowers to high interest rates, financial vulnerability, and limited opportunities for sustainable economic development. Using a qualitative case study approach, data were collected through in-depth interviews, observations, and document analysis involving managers, financing officers, and customers of BMT Wuluhan. The data were analyzed using thematic analysis to identify patterns of financial behavior and transformation processes among participants. The findings reveal that Islamic microfinance contributes significantly to reducing dependence on informal lenders by providing accessible Sharia-compliant financing and fostering financial capability among rural communities. Beyond financial access, BMT Wuluhan promotes behavioral changes through financial literacy development, trust-based institutional relationships, and the integration of Islamic ethical values. These factors collectively encourage more responsible financial management and strengthen economic resilience among customers. The study further proposes a Rural Financial Transformation Pathway consisting of financial access, institutional trust, financial capability development, behavioral adaptation, and economic resilience. This research contributes to the Islamic microfinance literature by shifting the focus from financing provision to the broader process of financial transformation and sustainable financial inclusion in rural communities.]]>
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