This study would try to address the problems that faced by Islamic banking institutions in Indonesia. The results showed that the problems that arise in the development of Islamic banks in Indonesia consists of four important aspects, namely: human, technical, legal/structural aspect, and market/communal aspect. Decomposition of problem as a whole gains the priorities: 1) There is not enough of Islamic banks capital yet; 2) Lack of understanding of Islamic bank practitioners; 3) Lack of government support; 4) the trust and public interest to Islamic banks tend to be low.While the priority of policy strategies that are considered able to resolve the problems of Islamic banking industry in Indonesia consists of: 1) strengthen the capital and business scale and improve the efficiency level; 2) improve the quantity and quality of human resources, and also information systems and technologies; Furthermore, 3) improve the structure of Islamic bank funds and harmonization of regulation and supervision.

This research aims at detecting early indicators that cause conventional banking and Islamic banking crises, identifying the longest crisis period for both types of banks, and comparing the stability between the two kinds of banks. The method used is the Markov Switching Vector Autoregressive (MS-VAR) approach. This study uses secondary data obtained from official sources and in monthly form from January 2004 to March 2017. The results show that Islamic banking is more stable against internal and external shocks than conventional banking. Z-score for Islamic banking is higher (11,933) than the Z-score for conventional banking (11,679). The longest crisis period for conventional banking was around April 2013 – March 2017 while for Islamic banking was around January 2008 – October 2008.

Despite of market condition under perfect or unperfect competition, Islamic banking has to reach their level of efficiency in order to succeed and make a profit; those who do not will fail and be forced to exit the market. However apart of having a sound performance, Islamic banking also has to comply with the sharia principles. This paper aims to have efficiency and maslahah measurement in one assessment framework that is maslahah-efficiency quadrant (MEQ). The study from 2011-2014 revealed that Bank Muamalat Indonesia (BMI) and Sharia Panin Bank are excellent since both are within the first quadrant. Whereas Bank Sharia Mandiri (BSM), Sharia Maybank, and Sharia Bukopin Bank are considered good at the second quadrant; Bank Rakyak Indonesia Sharia (BRI) and BCA Sharia are fair at the third; and Bank Mega Sharia, Victoria Sharia, Bank Negara Indonesia Sharia (BNI), and Bank Jabar Banten Sharia (BJB) are poor at the fourth sequentially. It is urge for Islamic bank that are in low level of MSI to have a critical policy to keep in line with the five factor of maqashid sharia apart of having efficiency in order to reach maslahah. Keywords

No abstract

Financial technology in Indonesia is an untapped market opportunity. As the world’s largest population Muslim country, the prospects for Islamic fintech in Indonesia seem very bright. This study tries to answer what problems, foundations and key ecosystem or stakeholders are involved in the development of Islamic fintech in Indonesia using Interpretive Structural Model (ISM) approach. The core problems faced in the development of Islamic financial technology industry are: Lack of policy instruments guarding the fintech work process, and availability of human resources for fintech. The core strategies or foundations that’s needed in framework of Islamic fintech development are: Ability to manage and analyze data in big data era, and Human resources in digital marketing. For the aspects of Ecosystem or Actors involved in the development of Islamic fintech in Indonesia, the important actor is: Government or regulator, Educational institutions (universities), and also Existing industries (banks and other financial institutions).