Integrating sustainable Islamic social finance: An Analytical Network Process using the Benefit Opportunity Cost Risk (ANP BOCR) framework: The case of Indonesia

Abstract

The utilization of Islamic social finance instruments is far behind what is expected. To realize its full potential, Islamic social finance instruments must be integrated. This study examined solutions and priority strategies for integrating sustainable Islamic social finance that could be implemented in the short and long term using the Benefit, Opportunity, Cost, and Risk (BOCR) framework, which includes six aspects: Governance, sustainable financing, institutional aspect, human resources, regulations, and supporting technology. This qualitative research employed the Analytic Network Process (ANP) method using the benefit, opportunity, cost, and risk analysis. The data were obtained mainly through focus group discussions and in-depth interviews with respondents among academics, practitioners, associations, regulators, and community leaders. The respondents were selected for their expertise and experience in the selected topic. The data were processed using the Microsoft Excel and Super Decision software. There are several findings worth considering from the analysis. First, the highest priority in integrating Islamic social finance aspects are human resources (0.97), regulation (0.86), and technology (0.76). Second, based on the short- and long-term analysis, financial integration through sustainable financing (0.01 and 1.44, respectively) and improving human resource quality through certification and training (0.01 and 1.56, respectively) is a priority solution and strategy to integrate sustainable Islamic social finance. Meanwhile, according to expert judgments, integrating national data (0.24) and optimizing technology use (0.18) are priority solutions and strategies. The findings emphasize the critical role of improving human resource quality to utilize technology, with experts identifying a national data integration as the most critical solution. As a result, relevant stakeholders are concerned about technology management training for Islamic philanthropic managers, with the goal of maximizing the potential of technology’s growing role and adoption.

Toward developing a sustainability index for the Islamic Social Finance program: An empirical investigation

“…The government invited other stakeholders to discuss the direction of program A development. Policy and regulatory approval from the government are fundamental to achieving the success and sustainability of the program [ 22 , 101 , 112 ]. The high score may explain why program A is more successful and sustainable than programs B and C.…”

“…Furthermore, according to Jouti [ 25 ], integrating several ISF instruments is one of the prominent factors in developing the ISF ecosystem. Widiastuti et al [ 22 ] analyzed Islamic social finance integration solutions and strategies, showing that data integration is the most priority solution.…”

“…The management of the Islamic Social Finance program is closely related to sustainability [22,23], where Islamic Social Finance plays a role in ensuring the sustainability of the beneficiaries' life [24,25]. Therefore, the Islamic Social Finance program is not only directed at the success of improving the quality of life of beneficiaries so that they can get out of the poverty but also at the sustainable quality of life.…”

“…In the context of the Islamic Social Finance program, by referring to the abovementioned definition of sustainability, it can be concluded that sustainability occurs when (1) the program can encourage the beneficiaries to be independent (able to meet their own needs) and (2) the program can prosper the beneficiaries. Thus, it needs various inputs and appropriate indicators to guide the empowerment programs and measure their success and sustainability [22]. Moreover, empowered programs in Indonesia are diverse due to various Islamic Social Finance institutions in the country [27].…”

Strategic Innovation in Philanthropic Institutions to Reduce Poverty Due to the Impact of COVID-19

“…This condition resulted in the widening of economic disparities between classes in society. Therefore, the vital role of Philanthropic institutions is to help the government overcome economic problems and poverty [43].…”