Islamic Banking and Income Inequality: The Role of Corporate Social Responsibility

doi:10.17576/jem-2020-5402-07

Cited by 8 publications

(6 citation statements)

References 47 publications

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“…In regions within the Lower cluster, financing inequality can actually contribute to reducing the inequality of job opportunities. Our findings significantly update the conclusions made in Mohamad et al [11], Yuliani & Rohman [12], and Biancone et al [13], which previously suggested that Sharia financing has a positive impact on reducing income inequality in both high and low inclusion areas. As a consequence, it may be necessary to reevaluate these findings using a clustering approach, as we did in this study, to test the consistency of the results, given that the sample has traditionally been considered homogeneous.…”

Section: Resultssupporting

confidence: 91%

“…Studies encompassing 24 member countries of the Organization of Islamic Cooperation (OIC) from 2006 to 2013 have shown that Islamic banks positively contribute to promoting equality [11]. Subsequent research further affirms the effectiveness of Islamic financing in mitigating inequality in both low-and high-income countries [12].…”

Section: Introductionmentioning

confidence: 93%

“…Another study, based on data from 33 provinces between 2010 and 2018, reveals that sharia financing and its depth, measured by the ratio of regional sharia financing to GRDP, are associated with an increase in the Gini ratio [14]. The divergence from previous studies [11][12][13], particularly the tendency toward the negative impact of sharia financing on income inequality in Indonesia [12][13], is likely due to differences in the research models employed. This is quite reasonable because Yuliani & Rohman [12] and Biancone et al [13] assume that the distribution of Sharia financing in nominal terms and market share is uniform, despite the uneven development of sharia financing in various regions of Indonesia.…”

Section: Introductionmentioning

confidence: 99%

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Revisiting the Role of Islamic Bank on SDGs: Sharia Financing, Inequality, and Poverty

Zuhroh,

Malik

2023

J. Hum. Earth Future

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This study aims to reassess the impact of Sharia financing provided by Islamic banks on the advancement of Sustainable Development Goals (SDGs), with a particular focus on reducing inequality and poverty. Given the uneven distribution of Sharia financing among regions in Indonesia, we adopt a clustering approach using the k-means clustering method. This approach considers two critical criteria: the nominal amount of Islamic financing and the proportion of Islamic financing. The clustering process resulted in the creation of two distinct clusters. The Lower cluster comprises regions characterized by a low market share and nominal Sharia financing, while the Upper cluster encompasses regions with a high market share and nominal Sharia financing. We utilized annual data from 33 provinces for the period spanning 2012 to 2020. Through the application of a fixed-effect panel regression with the Generalized Least Squares (GLS) approach, our analysis reveals that in the Upper cluster, the presence of Sharia financing plays a pivotal role in reducing financing inequality, inequality in job opportunities, and notably lowering the poverty rate. In contrast, only nominal Sharia financing appears to contribute to the reduction of poverty, with no discernible impact observed regarding financing inequality and disparities in employment opportunities. Doi: 10.28991/HEF-2023-04-04-05 Full Text: PDF

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Section: Resultssupporting

confidence: 91%

Section: Introductionmentioning

confidence: 93%

Section: Introductionmentioning

confidence: 99%

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Revisiting the Role of Islamic Bank on SDGs: Sharia Financing, Inequality, and Poverty

Zuhroh,

Malik

2023

J. Hum. Earth Future

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“…Our research raises another important topic and that is social inequality. The work [12] shows the impact of Islamic accounting on the solvability of this problem. However, the work does not directly compare social responsibility of companies in the Western practice with that of Islamic banking.…”

Section: Literature Reviewmentioning

confidence: 99%

Islamic (Partner) Accounting and its Comparison with International Financial Accounting Standards (IFRS)

Voronova¹,

UMAROV²

2021

ujaf

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“…The establishment of Islamic banking was a much awaited solution for Muslims seeking to accord their financial realm with their faith. High expectations were naturally placed directly on the shoulders of Islamic Banks (IBs) to not only serve the financial needs of the Muslim believers but also to manifest broader social justice principles (Dusuki, 2005;Iqbal and Mirakhor, 2012;Zaman, 2008;Hassan and Kayed, 2009;Ashraf et al, 2014;Mohamad et al, 2020;Sabiu and Abduh, 2021). The products offered by IBs have been subsequently demanded to satisfy each element of the society (Ayyub et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

Salam financing: from common local issues to a potential international framework

Mulyany¹,

Indriani²

2021

IMEFM

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Purpose This research is concerned with the development of Salam, which caters for the specific needs of farmers, who form a vital yet fragile group in most developing nations. Based on the local context of Aceh Province in Indonesia which is considered to be parallel with other developing countries, the purpose of this paper is to embrace the whole set of issues and sketch out an extended Business Model Canvas (BMC) for Salam financing by delineating the three W’s of What, Why and How Salam can be offered by Islamic Banks (IBs). Design/methodology/Approach In-depth interviews were conducted with key stakeholders comprising of farmers, higher-ranking bankers of IBs, members of the Syariah Supervisory Board and academicians who are experts in Islamic finance. The re sults of the interviews added to a review of the literature were also mapped onto an extended canvas model. Findings Several interesting insights are derived and, primarily, that Salam is a feasible product to be offered by IBs, provided that there is a significant change in the thinking paradigm and risk mitigation models by all stakeholders, but mainly the IBs and the regulators. Research limitations/implications This study may be limited in the number and range of respondents who were chosen for interview. There are possibly other key informants, such as regulators and local custom figures, who may willing to provide useful information. The application of BMC for Salam may also be relatively new, hence its justification for a wider implementation may still need further analysis. Originality/value This study is deemed to add significant perspectives on product development and innovation in Islamic banking and particularly regarding Salam. This study advances the method used to study Salam by contextualising the product mapping of Salam into an extended BMC.

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Islamic Banking and Income Inequality: The Role of Corporate Social Responsibility

Cited by 8 publications

References 47 publications

Revisiting the Role of Islamic Bank on SDGs: Sharia Financing, Inequality, and Poverty

Revisiting the Role of Islamic Bank on SDGs: Sharia Financing, Inequality, and Poverty

Islamic (Partner) Accounting and its Comparison with International Financial Accounting Standards (IFRS)

Salam financing: from common local issues to a potential international framework

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