Determining the characteristics of waqf-based Islamic financial institution and proposing appropriate models for Indonesia

Abstract

Purpose

This study aims to determine the characteristics of waqf-based Islamic financial institution (IFI) and subsequently propose some waqf-based IFIs.

Design/methodology/approach

This study uses the Delphi method, combined with the Likert scale, to determine and validate the agreed characteristics of waqf-based IFI models. Subsequently, based on the agreed characteristics, the authors propose waqf-based IFI models.

Findings

The results show that there are 28 important characteristics of waqf-based IFI, which respondents agree on 24 characteristics with significant Kendall’s concordance or rater agreement (W). The type of waqf-based IFI could be a bank, venture capital or cooperative; the business orientation should be a combination of commercial-social, and it could be implemented in the national, community or micro level. Based on the agreed characteristics, the authors propose several waqf-based IFI, including integrated commercial-social waqf-based bank, integrated commercial-social waqf-based venture capital and integrated commercial-social waqf-based cooperative.

Research limitations/implications

Respondents of this study comprise experts and practitioners who reside in Indonesia so that the results of proposed waqf-based IFIs are most suitable to be implemented in Indonesia.

Practical implications

The conceptual framework and method used in this study could be applied to determine the characteristics of waqf-based IFI and propose the most suitable waqf-based IFI models in other countries.

Originality/value

This study starts with determining the essential characteristics of waqf-based IFI, which then be used to propose waqf-based IFI models.

Citation

Ascarya, A., Husman, J.A. and Tanjung, H. (2023), "Determining the characteristics of waqf-based Islamic financial institution and proposing appropriate models for Indonesia", International Journal of Ethics and Systems, Vol. 39 No. 1, pp. 143-164. https://doi.org/10.1108/IJOES-01-2022-0001