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The Urgency of Allignment Islamic Bank to Increasing the Outreach (Indonesia Evidence)

Author

Listed:
  • Lucky Nugroho

    (Mercu Buana University, Jakarta, Indonesia,)

  • Wiwik Utami

    (Mercu Buana University, Jakarta, Indonesia,)

  • Citra Sukmadilaga

    (Padjadjaran University, Indonesia)

  • Tettet Fitrijanti

    (Padjadjaran University, Indonesia)

Abstract

The outreach of Islamic Bank is critical to circulate out of maslahah (beneficiaries) to the community (Ummah) and the implementation of Sharia in totality (Kaffah). Nevertheless, Indonesia as the biggest Muslim in the world should facilitate the Muslim society to access their financial transaction needs based their Islamic law. The study aims to examine the outreach of Islamic Bank in Indonesia. The methodology in this literature review is qualitative that support with quantitative data. Three questions research is going to determine in this study are: (i) How the growth of Islamic Banks from 2008 to 2015? (ii) How many the clients that have sworn out by Islamic Banks? (iii) What is the link between maslahah and the Islamic Bank growth? We founded the outlet and business performance during 2008-2015 of Islamic Bank in Indonesia still behind from Conventional Bank thus to improve the backward we need interaction, integration and evolution process from all stakeholders. Due to achieve the increasing of outreach we also need the role of government in the political will that function to legitimate and enforce the alignment of Islamic Banks (Bank Syariah Mandiri, BNI Syariah, BTN Syariah and BRI Syariah) became one state own Islamic Bank which objective to create social well-being of the community

Suggested Citation

  • Lucky Nugroho & Wiwik Utami & Citra Sukmadilaga & Tettet Fitrijanti, 2017. "The Urgency of Allignment Islamic Bank to Increasing the Outreach (Indonesia Evidence)," International Journal of Economics and Financial Issues, Econjournals, vol. 7(4), pages 283-291.
  • Handle: RePEc:eco:journ1:2017-04-37
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    References listed on IDEAS

    as
    1. Reed, Clyde G. & Bekar, Cliff T., 2003. "Religious prohibitions against usury," Explorations in Economic History, Elsevier, vol. 40(4), pages 347-368, October.
    2. Irawan Febianto & Rahmatina A. Kasri, 2007. "Why Do Islamic Banks Tend To Avoid Profit And Loss Sharing Arrangements ?," Working Papers in Business, Management and Finance 200705, Department of Management and Business, Padjadjaran University, revised May 2007.
    3. Lee, Chien-Chiang & Lin, Chun-Wei, 2016. "Globalization, political institutions, financial liberalization, and performance of the insurance industry," The North American Journal of Economics and Finance, Elsevier, vol. 36(C), pages 244-266.
    4. Adel Ahmed, 2010. "Global financial crisis: an Islamic finance perspective," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing, vol. 3(4), pages 306-320, November.
    5. repec:eco:journ2:2017-03-09 is not listed on IDEAS
    6. Aysan, Ahmet F. & Disli, Mustafa & Ng, Adam & Ozturk, Huseyin, 2016. "Is small the new big? Islamic banking for SMEs in Turkey," Economic Modelling, Elsevier, vol. 54(C), pages 187-194.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Outreach; Maslahah; Kaffah; Allignment of Islamic Bank; State Own Islamic Bank; Social Well-being;

    JEL classification:

    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G2 - Financial Economics - - Financial Institutions and Services

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