Vulnerability of Islamic Financial Institutions in a Financial Crisis

Setiawan, Romi Adetio

doi:10.18502/kss.v3i8.2502

Cited by 3 publications

(3 citation statements)

References 4 publications

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“…In a recent investigation conducted by Ayub et al (2023), it was established that riba (interest) yields detrimental effects on society, whereas ethical finance offers unique dimensions to enhance economic wellbeing. Notably, research has shown that Islamic banking establishments have played a role in promoting financial stability and resilience, particularly during times of global financial upheavals (Alrifai 2015;Bhatti and Bhatti 2009;Reno and Abdullah 2016;Setiawan 2018). The principles of risk-sharing, avoidance of interest (riba), and asset-based financing in non-riba loan systems have contributed to increased financial inclusivity, providing access to financing for small and medium-sized enterprises (SMEs) and individuals who were previously underserved (Shabsigh et al 2017).…”

Section: Dimensions Of Shari'ah Mode Financing and Quality Of Lifementioning

confidence: 99%

Avoidance of Riba-Based Loans and Enhancement of Quality of Life: An Indonesian Context Analysis

Setiawan

2023

Religions

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Riba (usury) has long been a contentious issue in Islam due to its adverse effects on economic equity and social wellbeing. This paper delves into the intricate relationship between refraining from the use of riba-based loans and the quality of life, with a specific focus on the unique context of Bengkulu, Sumatra, Indonesia. By conducting an extensive analysis of the existing literature and empirical evidence, this study explores the multifaceted dimensions of transitioning away from riba-based loans and their negative consequences. The findings demonstrate that the avoidance of riba-based loans leads to a ripple effect of positive changes and improved mental and physical wellbeing. Furthermore, the ethical dimension underscores the alignment of financial practices with an equitable society and moral values, thereby fostering religious awareness and realization. The paper argues that transitioning away from riba-based loans does not merely serve as a potent catalyst for improving the quality of life exclusively within Muslim communities but extends the impact, transforming the contemporary way of life into a more sustainable and inclusive financial ecosystem. This transformation is achieved by steadfastly prioritizing ethical conduct, spiritual fulfilment, social responsibility, and the equitable sharing of prosperity. This research provides valuable insights for policymakers, practitioners, and researchers who are dedicated to advancing the understanding and implementation of Islamic finance for the betterment of society.

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Section: Dimensions Of Shari'ah Mode Financing and Quality Of Lifementioning

confidence: 99%

Avoidance of Riba-Based Loans and Enhancement of Quality of Life: An Indonesian Context Analysis

Setiawan

2023

Religions

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“…The validity of digitally signed documents is weakened by the use of manual stamps, requiring companies to obtain a digital stamp for digital signatures. Lastly, users face difficulties when verifying data (selfies), raising concerns about potential leaks of personal information (Setiawan, 2022). Privy's management infrastructure requires a clear overhaul that focuses on integrating strategy, execution, and analytics.…”

Section: Introductionmentioning

confidence: 99%

Proposed Corporate Performance Management Using Knowledge-Based Performance Management System (KBPMS) For Privy

Dimas Kusuma

2024

JOEB

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PT. Privy Identitas Digital or Privy Digital Identity (Privy) is a firm established in Jakarta in 2016 that specializes in the provision of Certified Electronic Certificate Organization and Electronic Signature Organization services. Privy offers legally enforceable digital signature services, along with reliable digital identities, facilitating direct connections between businesses and customers. This thesis investigates the deployment of an integrated performance management system emphasising the Knowledge-Based Performance Management System (KBPMS) at PT. Privy Identitas Digital (Privy), a firm that specialises in certified electronic certificates and digital signatures. The exponential expansion of Privy's services has highlighted the need of aligning its business strategy with frontline operations by using integrated planning and monitoring tools. The research study of integrated performance management, which includes financial goals, customer, process, and employee perspectives, is examined in detail. The suggested method uses a robust performance management framework to address enterprise issues including traditional marketing tactics and the absence of Key Performance Indicators (KPIs). KBPMS optimises company performance, meets business objectives, and promotes continuous development. Significant benefits are anticipated to result from the implementation of the KBPMS, including the following: increased talent development by means of targeted training and feedback derived from individual performance evaluations; enhanced employee engagement and motivation through transparent feedback and aligned goals; increased organisational agility and responsiveness to market changes via data-driven performance insights; and optimised resource allocation and cost reduction via the KBPMS. By showcasing the advantages of incorporating digital technology into performance management, it facilitates the adoption of comparable approaches by other organisations, thereby maximising the capabilities of their workforce.

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“…This is, of course, related to the costs incurred and the possible systemic impact. The use of imported raw materials used by companies in managing investments provided by Islamic banking is one of the causes of the negative response by Islamic banking (Setiawan, 2018). When the price of raw materials increases due to the depreciation of the rupiah, it will reduce the use of imported raw materials so that the investment capitalization value decreases.…”

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confidence: 99%

Economic Turmoil in Islamic Banking Investment

Budiandru

Yuniarti

2020

Etikonomi

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Investment financing is one of the operational activities of Islamic banking to encourage the real sector. Islamic banking provides funding for investment because it can increase economic growth. This study aims to analyze the effect of economic turmoil on Islamic banking investment financing, analyze the response of Islamic banking investment financing to the financial crisis, and analyze each variable's contribution in explaining the diversity of Islamic banking investment financing. This study uses monthly time series data from 2009 to 2020 using the Vector Error Correction Model (VECM) analysis. This study's results indicate that the exchange rate, inflation, and interest rates have a significant effect on Islamic banking investment financing in the long term. The response to Islamic banking investment financing is the fastest to achieve stability when responding to shocks to the composite stock price index. In contrast, the most significant contribution in explaining the diversity of levels of Islamic banking investment financing comes from inflation. Islamic banking can increase the proportion of funding for investment. With an increase in investment financing, customers will have a more substantial business scale to boost economic growth.JEL Classification: E22, G11, G24

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Vulnerability of Islamic Financial Institutions in a Financial Crisis

Abstract: .

Cited by 3 publications

References 4 publications

Avoidance of Riba-Based Loans and Enhancement of Quality of Life: An Indonesian Context Analysis

Avoidance of Riba-Based Loans and Enhancement of Quality of Life: An Indonesian Context Analysis

Proposed Corporate Performance Management Using Knowledge-Based Performance Management System (KBPMS) For Privy

Economic Turmoil in Islamic Banking Investment

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