TOWARDS AN INTEGRATED ISLAMIC SOCIAL AND COMMERCIAL FINANCE SYSTEM: EVIDENCE FROM INDONESIA’S LEVELING FINANCING MODEL
DOI:
https://doi.org/10.54783/7mnmne78Keywords:
ta‘awun, tijari, Islamic inclusive finance, productive zakat, NPFAbstract
The global expansion of Islamic finance continues to show significant growth; however, a structural gap
persists between social instruments (ta‘awun) such as zakat, infak, and waqf and commercial instruments
(tijari) operated by Islamic banks and Islamic microfinance institutions. This gap has resulted in limited
access to appropriate financing for segments of society, particularly ultra-micro entrepreneurs and the
productive poor, whose financial capacity does not yet meet commercial lending standards. At the same time,
Islamic financial institutions face rising levels of Non-Performing Financing (NPF), largely due to the
misalignment between the type of financing provided and the financial readiness of beneficiaries. This study
proposes an integrated ta‘awun–tijari model through a tiered Islamic financing system, which links social
funds and commercial funds in gradual stages. The model is expected to enhance the resilience of Islamic
financial institutions while simultaneously improving the overall well-being of the community.
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