Investigating drivers of <i>qardhul hassan</i> financing acceptance in the time of COVID-19: a Malaysian breadwinner perspective

Amin, Hanudin

doi:10.1108/ijse-06-2022-0420

Cited by 9 publications

(10 citation statements)

References 23 publications

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“…Zakah or shadaqah institution can use QH to help the poor. QH is increasingly showing its role during the covid pandemic where many people need help to fulfil their needs (Amin, 2022). Zakah institutions in Indonesia can be divided into two types: amil zakah institutions – established by private organisations, and the National Board of Amil Zakah – established by the government.…”

Section: Discussionmentioning

confidence: 99%

“…Previous studies have shed light on the role of QH financing in the economy. Amin (2022) stated that QH financing is urgently needed by Malaysian breadwinners as a beneficial financial assistance, especially during the COVID-19 period. Unstable financial conditions during the pandemic have further strengthened QH’s role as a facility that can help meet their needs, such as food, emergency, education and business capital.…”

Section: Literature Reviewmentioning

confidence: 99%

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The optimisation of Qardhul Hasan management in Islamic banking: enhancing its role in empowering the community

Nugraheni

Muhammad

2023

JEC

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Purpose Qardhul Hasan (QH) is a type of Islamic contract that prioritises benevolent aspects between beneficiaries and the fund provider. The effective management and distribution of QH can contribute to overcoming economic problems in society. This study aims to explore the potential to enlarge the sources of QH funding and QH financing in Indonesian Islamic banks. The paper proposes a framework for QH management in Islamic banks by identifying the sources of QH funds as well as the management and potential allocations of QH funds. Design/methodology/approach This study uses a descriptive analysis method with a framework-based review to discuss the strategy of optimising the sources, financing and management of QH in Islamic banks. The implementation of QH in the Islamic banking industry is described based on the previous literature and current phenomena. Findings To positively impact economic development, Islamic banks can collaborate with parties that are more focused on charitable activities and have greater resources to channel and use QH funds. This study also formulates a framework of QH funds management that prioritises efforts to multiply benefits for both the fund provider and the beneficiaries. Research limitations/implications The descriptive method used in this paper comprises preliminary research to analyse the current phenomena and potential strategies that can be implemented. Future studies may use empirical data to strengthen the analysis. Practical implications The recommendations of this paper can be used by relevant social fund management institutions in collaboration with Islamic banking. Social implications QH reflects not only the social aspects of Islamic banks and extends beyond their corporate social responsibility activities, its effective management will make a greater contribution to reducing the level of unemployment, poverty alleviation and supporting the country’s economic development. Originality/value This paper provides a framework that integrates financial institutions in maximising QH fund management to encourage greater benefits for the community. Although previous studies have mentioned the important role of QH, relatively few have considered how Islamic banks maximise its management.

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Section: Discussionmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

The optimisation of Qardhul Hasan management in Islamic banking: enhancing its role in empowering the community

Nugraheni

Muhammad

2023

JEC

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“…IBs are expected to consider social engagement and not only focus on profit (Chapra, 1979;Ahmad, 2000;Al-Zuhayli, 2003;Hamidi and Worthington, 2023). The Shariah in principle encourages IBs to engage in social financing to assist low-income earners such as the farmers using bai'salam contracts, financing Small and Medium Scale Enterprises (SMEs) through sadaqat and musharakah, providing soft loans using qard al-hasan, extending charitable means and paying zakat (Dasuki, 2008;Hassan and Harahap, 2010;Abd Samad et al, 2018;Amin, 2022b). These variables are seen as social finance instruments (Bani et al, 2015).…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

Social finance, institutional quality and stability of Islamic banks: evidence from four countries

Danlami

Abduh

Razak

2023

IJSE

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PurposeIslamic banks, despite being Shariah-compliant, have long been criticized for mimicking conventional banks in terms of their products and processes (Khan, 2010; Kuran, 1996). However, several Islamic banks do engage in philanthropy (zakat and charity) and risk-sharing financing (mudarabah and musharakah) instruments that better meet their raison d'etre, the fulfillment of Maqasid al-Shariah (Jatmiko et al., 2023). These contracts, however, are more susceptible to moral hazard and adverse selection problems than traditional debt-based finance (Azmat et al., 2015) and may impair Islamic bank stability. This paper explores the relationship between social finance and the stability of Islamic banks, and whether institutional quality moderates this relationship.Design/methodology/approachUsing hand-collected annual data on social finance from 12 Islamic banks in four countries: Bangladesh, Bahrain, Indonesia and Malaysia, between 2006 and 2019, the authors employ the feasible generalized least squares and the panel-corrected standard errors methods for the analysis. The Stata version 16 software was used to analyze the data for the study.FindingsThe results indicate that mudarabah and musharakah financing raises the stability of Islamic banks. The authors also found that mudarabah and musharakah expose Islamic banks to more risk-taking behavior amidst the conditioning effect of institutional quality. On the other hand, charity induces the stability of Islamic banks, while zakat increases the risk-taking behavior of the banks. Further, when the quality of institutions was used as a moderator, both zakat and charity induced the stability of Islamic banks. The results were robust when liquidity risk was used and partially robust when portfolio risks were employed as measures of stability.Research limitations/implicationsOne concern regarding the application of Islamic social finance is that it might be a risky strategy for Islamic banks. In terms of research implications, the available evidence suggests that the use of Islamic social finance instruments is not detrimental to the stability of Islamic banks. Hence, regulators and policymakers should not penalize Islamic banks for using Islamic social finance instruments that help provide financial solutions to the underserved and unserved. In terms of research limitations, the study could not include other relevant Islamic social finance instruments such as waqf and qard al-hassan. Furthermore, data availability restricts the analysis to only 12 Islamic banks in fourcountries. As more Islamic banks in different countries venture into Islamic social finance, and the quantity and quality of information improve, future studies could explore the issue further.Social implicationsThe available evidence suggests that the use of Islamic social finance instruments does not worsen the stability of Islamic banks. Given the dominance of sale- and lease-based contracts in Islamic financing (Aggarwal and Yousef, 2000; Šeho et al., 2020), these findings should encourage other Islamic banks to provide financial solutions using other Shariah-compliant contracts including those based on risk-sharing and philanthropy. This would be a better reflection of the Islamic banks’ value proposition as it helps boost social activities that have a high impact on the activities of small businesses, contributing to the real economy and promoting well-being in society.Originality/valuePrevious studies mainly relied on mudarabah, mushakarah and zakat separately as they relate to the performance of Islamic banks. This study explores the impact of social finance which includes charity and zakat to examine their impact on Islamic banks’ stability. Further, the authors use institutional quality as a moderating variable in the relationship between Islamic social finance instruments and the stability of Islamic banks.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-06-2022-0441

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“…Within the realm of consumer behavior, the inclination to acquire a product is predicated upon a favorable disposition toward the said product, with the potential for attitudes toward alternative products within the available options also exerting an influence on this positive disposition (Laroche et al, 1996). Significantly, scholarly research in the field of Islamic finance has placed considerable emphasis on the significance of attitude as a crucial determinant in shaping the intention to utilize Islamic personal financing, as highlighted by Amin et al (2010). Moreover, previous research has indicated that individuals with a positive attitude or a favorable inclination toward Islamic financing exhibit a greater intention to obtain Islamic personal financing products (Fauziah et al, 2008;Ahmed et al, 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

Individuals’ purchase intention of the Sukuk bond: A study on developing economy

M. Anwarul Islam,

Islam,

Al-Kharusi

et al. 2023

Innovative Marketing

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The Shariah-compliant (Sukuk) bond has been recently introduced in Muslim countries. Sukuk is getting popular among the Muslim population because of its non-interest feature. Thus, this study explores the impact of attitude toward the Sukuk bond, Muslim people’s religiosity, and their subjective norms on the purchase intention of the Sukuk bond in a Muslim developing country: Bangladesh. The study involved 412 individuals who were current customers of Islamic financial products at different financial institutions in Dhaka, Bangladesh. The study used a convenience sampling technique. The study used a survey questionnaire to assess the three independent variables: attitude, religiosity, and subjective norms. The dependent variable was the purchase intention of the Sukuk bond. The statistical software package, SPSS version 29.0, was utilized to test the hypotheses considering a 95% confidence interval. The findings indicate that three independent variables significantly correlated with the dependent variable. The highest correlation was found between subjective norms (r = 0.644) and purchase intention. The regression results suggest that attitude, religiosity, and subjective norms statistically impact the individuals’ purchase intention of the Sukuk bond in Bangladesh. It also shows that consumers’ attitude (β = 0.386) has a greater impact on their purchase intention. Also, consumers’ subjective norms (β = 0.302) have the second highest influence on purchase intention. These variables explain a significant proportion of the variability observed in purchase intention. Also, the t-test shows that male individuals have higher purchase intentions than females.

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Investigating drivers of qardhul hassan financing acceptance in the time of COVID-19: a Malaysian breadwinner perspective

Cited by 9 publications

References 23 publications

The optimisation of Qardhul Hasan management in Islamic banking: enhancing its role in empowering the community

The optimisation of Qardhul Hasan management in Islamic banking: enhancing its role in empowering the community

Social finance, institutional quality and stability of Islamic banks: evidence from four countries

Individuals’ purchase intention of the Sukuk bond: A study on developing economy

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