Integrated financing model in Islamic microfinance institutions for agriculture and fisheries sector

Anwar, Aan Zainul; Susilo, Edi; Rohman, Fatchur; Santosa, Purbayu Budi; Gunanto, Edy Yusuf Agung

doi:10.21511/imfi.16(4).2019.26

Cited by 10 publications

(8 citation statements)

References 16 publications

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“…Besides the role of attitudes and beliefs in decision-making, a wide range of literature has recognized the non-economic factors, like culture, control elements and religion (Hilary and Hui, 2009). In Pakistan, Muslims are strictly prohibited by Shari’ah for receiving interest-based loans to fulfill their production and non-production needs (Anwar et al , 2019; Kaleem and Wajid, 2009; Sardar et al , 2013; Zafar et al , 2015). These researchers have determined that Islamic financial products, e.g.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Understanding farmers’ decision-making to use Islamic finance through the lens of theory of planned behavior

Ali

Shang

2022

JIMA

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Purpose This study aims to determine the non-economic factors that probably influence the Pakistani farmers to use Islamic finance for agricultural production. This paper analyzes the other religiosity and familial leadership constructs in the standard theory of planned behavior (TPB) model from the Islamic banking perspective. Design/methodology/approach Data were collected from 233 farmers using snowball sampling techniques and partial least square structural equation modeling used for data analysis. An additional qualitative analysis was conducted of seven respondents through semi-structured interviews to deepen into knowledge about Islamic banking. Findings The findings demonstrate that attitude, subjective norms, religiosity and familial leadership to use Islamic banking among the farmers play a primary motivating role in manipulating their behavioral intentions to use it. However, PBC negatively affected the behavior of farmers to use Islamic banking. Practical implications This study highlights the importance of emotional attachment between the farmers and Islamic financial products according to Shariah law. Therefore, Islamic banks need effective strategies for the development of innovative products in the agricultural sector according to the Shariah principle. Originality/value The research contributes to the area of Islamic banking, demonstrating that “familial leadership” significantly influences an individual’s behavior toward decision-making to use Islamic finance.

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Understanding farmers’ decision-making to use Islamic finance through the lens of theory of planned behavior

Ali

Shang

2022

JIMA

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“…Salam also requires the value of excellence offered to farmers, of course, by providing mutual benefits between farmers and Islamic banks. In the concept of the Salam contract, the contract will be carried out at the beginning by farmers and Islamic banks, this provides capital assistance to farmers so that they can increase productivity and optimize land processing (Anwar et al, 2019). The proceeds from the commodity are then given to the bank according to the initial contract price.…”

Section: Financing Development Model Of Salam Contractmentioning

confidence: 99%

“…On the one hand, farmers need definite financing. However, it is not balanced with the availability of financing from Islamic banks (Anwar et al, 2019). Only a handful of financial institutions provide and design financing for agriculture.…”

Section: A Introductionmentioning

confidence: 99%

Sharia Banking Contract Model: Alternative Financing For the Agricultural Sector in Indonesia

Prayogi,

Ramadhan

2024

IJIE

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Introduction: In the Islamic conceptualization, banking has a central position as a financing institution for every Muslim that is free from ribawi elements. Sharia banking has made various efforts, such as formulating innovative products to meet credit needs. Unfortunately, these efforts are hampered by several factors, especially the mode of Sharia banking and the limited knowledge of Sharia banking staff regarding fiqh. One of the Sharia banking products that cannot be implemented until now is contracts sallam. Though Salam contract can accommodate credit needs, especially for farmers, promptly. In this case, of course, Islamic banking needs to take a role and take action to meet the needs of these farmers. Objectives: So, this paper aims to elaborate and formulate a contract model salam in banking by considering the problems faced by sharia banks and farmers. The formulation of the problem is how the contract model salam in sharia banking for agricultural financing in Indonesia. Method The approach used in this paper is qualitative with the type of research being the analysis content Results: The result of this research is that a contract salam can be implemented in Sharia banking. However, it requires an integration model from Sharia banking to microfinance institutions so that contract financing salam can be accommodated very well. Implications: It is hoped that this research will have an impact in formulating contract models salam which so far cannot be implemented in sharia banking.

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“…Several studies related to Islamic finance as a source of financing for the agricultural sector, for example found in the studies of Ningrat & Nurzaman (2019), Kaleem & Wajid (2009), Anwar et al, (2019), Saqib et al, (2015Saqib et al, ( , 2014, Shafiai & Moi (2015), and also Elhiraika (1996).…”

Section: Agricultural Sector Capitalmentioning

confidence: 99%

Islamic Social Finance as Source of Financing Agricultural Sector in Indonesia

Nurfalah,

Al-Parisi

2023

EII

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The shrinking of rice fields causes crop yields to decrease. Apart from that, financing in this sector is not attractive to investors because it is high risk. The minimal financing of agricultural sector credit is the reason for the author to discuss the problems faced in agricultural sector credit. The source of agricultural credit capital is the synergy between agricultural zakat and the government budget for food security and is allocated according to needs. So, sharia banking, the government and Baznas collaborate in raising funds for agricultural credit. This paper takes an example of an agricultural sector financing scheme from Japan which has been successfully implemented. However, Japan's credit financing comes from government funds only. This encourages the author to innovate credit financing in the agricultural sector, especially food diversification commodities, namely the synergy between agricultural zakat and the government budget for food security. Agricultural zakat is centralized by Baznas and then handed over to the Indonesian Agricultural Association (API). API determines the budget allocation of these funds and then submits it to Bank Indonesia (BI). BI hands it back to sharia banking to be credited to farmers with a predetermined allocation and the remaining allocated funds are deposited.

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Integrated financing model in Islamic microfinance institutions for agriculture and fisheries sector

Cited by 10 publications

References 16 publications

Understanding farmers’ decision-making to use Islamic finance through the lens of theory of planned behavior

Understanding farmers’ decision-making to use Islamic finance through the lens of theory of planned behavior

Sharia Banking Contract Model: Alternative Financing For the Agricultural Sector in Indonesia

Islamic Social Finance as Source of Financing Agricultural Sector in Indonesia

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