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Article
Publication date: 8 June 2021

Fahmi Ali Hudaefi and Abdul Malik Badeges

In Indonesia, subjective issues towards the fundamental of Islamic banks (IBs) have been arising. For example, they are claimed to be not in line with the Shari‘ah…

Abstract

Purpose

In Indonesia, subjective issues towards the fundamental of Islamic banks (IBs) have been arising. For example, they are claimed to be not in line with the Shari‘ah (Islamic law). Furthermore, the existing scholarly works have not much gained knowledge from the local IBs explaining their efforts in promoting maqasid al-Shariah (objectives of Islamic law). Hence, because religiosity drives the fundamental establishment of IBs, this paper aims to explore the knowledge of how IBs in Indonesia promote maqasid al-Shariah via their published reports.

Design/methodology/approach

This paper performs text mining from 24 official reports of 5 IBs in Indonesia published from 2015 to 2017. The sample contains 7,162 digital pages and approximately 3,021,618 words. Traditional text mining via human intelligence is first performed to analyse for the numerical data required in the maqasid al-Shariah index (MSI) analysis. Furthermore, a computer-driven text mining using the ‘Text Search’ feature of NVivo 12 Plus is conducted to perform qualitative analysis. These approaches are made to gain relevant knowledge of how the sampled IBs promote maqasid al-Shariah from their published reports.

Findings

The analysis using the MSI explains a quantified maqasid al-Shariah on the sample’s performance, which indictes the lowest and the highest performing banks. Furthermore, a qualitative analysis supports the evidence from the quantitative analysis. It explains the authors’ coding process that results in 2 parent nodes and 20 child nodes, which contain 435 references coded from the sampled unstructured and bilingual texts. These nodes explain the information that associates with maqasid al-Shariah from the IBs’ reports. These findings explain how maqasid al-Shariah is measured mathematically and represent relevant knowledge of how maqasid al-Shariah is informed practically via digital texts.

Research limitations/implications

A positivist generalisation is neither intended nor established in this study.

Practical implications

This paper gains relevant knowledge of how the sampled IBs in Indonesia control and maintain the implementation of maqasid al-Shariah from large textual data. Such knowledge is practically important for IBs stakeholders in Indonesia; moreover to help navigate the Shari‘ah identity of Bank Syariah Indonesia (BSI), the new IB established from the merger of 3 state-owned IBs, which are among the sample of this study.

Social implications

This paper provides evidence that might best challenge the subjective issue of IBs claiming that they are not in line with the Shari‘ah, particularly in Indonesia.

Originality/value

This paper is among the pioneers that discover knowledge of how IBs promote maqasid al-Shariah in Indonesia’s banking sector via a text mining approach.

Details

Journal of Islamic Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0833

Keywords

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Article
Publication date: 22 June 2021

Fahmi Ali Hudaefi, Rezzy Eko Caraka and Hairunnizam Wahid

Zakat during the COVID-19 outbreak has played a vital role and has been significantly discussed in the virtual environment. Such information about zakat in the virtual…

Abstract

Purpose

Zakat during the COVID-19 outbreak has played a vital role and has been significantly discussed in the virtual environment. Such information about zakat in the virtual world creates unstructured data, which contains important information and knowledge. This paper aims to discover knowledge related to zakat administration during the pandemic from the information in a virtual environment. Furthermore, the discussion is contextualised to the socio-economic debates.

Design/methodology/approach

This is a qualitative study operated via text mining to discover knowledge of zakat administration during the COVID-19 pandemic. The National Board of Zakat Republic of Indonesia (BAZNAS RI) is selected for a single case study. This paper samples BAZNAS RI’s situation report on COVID-19 from its virtual website. The data consists of 40 digital pages containing 19,812 characters, 3,004 words and 3,003 white spaces. The text mining analytical steps are performed via RStudio. The following R packages, networkD3, igraph, ggraph and ggplot2 are used to run the Latent Dirichlet Allocation (LDA) for topic modelling.

Findings

The machine learning analysis via RStudio results in the 16 topics associated with the 3 primary topics (i.e. Education, Sadaqah and Health Services). The topic modelling discovers knowledge about BAZNAS RI’s assistance for COVID-19 relief, which may help the readers understand zakat administration in times of the pandemic from BAZNAS RI’s virtual website. This finding may draw the theory of socio-economic zakat, which explains that zakat as a religious obligation plays a critical role in shaping a Muslim community's social and economic processes, notably during the unprecedented times of COVID-19.

Research limitations/implications

This study uses data from a single zakat institution. Thus, the generalisation of the finding is limited to the sampled institution.

Practical implications

This research is both theoretically and practically important for academics and industry professionals. This paper contributes to the novelty in performing text mining via R in gaining knowledge about the recent zakat administration from a virtual website. The finding of this study (i.e. the topic modelling) is practically essential for zakat stakeholders to understand the contribution of zakat in managing the COVID-19 impacts.

Social implications

This work derives a theory of “socio-economic zakat” that explains the importance of a zakat institution in activating zakat for managing socio-economic issues during the pandemic. Thus, paying zakat to an authorised institution may actualise more maslahah (public interest) compared to paying it directly to the asnaf (zakat beneficiaries) without any measurement

Originality/value

This study is among the pioneers in gaining knowledge from Indonesia’s zakat management during the COVID-19 outbreak via text mining. The authors’ way of analysing data from the virtual website using RStudio can advance Islamic economics literature.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8394

Keywords

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Article
Publication date: 8 January 2021

Fahmi Ali Hudaefi and Irfan Syauqi Beik

Despite the COVID-19 recession, the collection of zakat (almsgiving) managed by the National Board of Zakat Republic of Indonesia (BAZNAS RI) has increased, especially…

Abstract

Purpose

Despite the COVID-19 recession, the collection of zakat (almsgiving) managed by the National Board of Zakat Republic of Indonesia (BAZNAS RI) has increased, especially during Ramaḍān 1441 Hijra. Previous works show a positive relationship between digital zakat campaign and zakat collection. This paper aims to study the means of digital zakat campaign during COVID-19 outbreak. This topic is theoretically and practically important in the emerging debate of Islamic marketing, notably in Islamic social finance field.

Design/methodology/approach

This paper uses a qualitative research approach. A case study is engaged in the selection of BAZNAS RI for a detailed discussion of a zakat organisation. Meanwhile, a netnographic approach is used to analyse the number of 549 posts from BAZNAS RI’s social media, which are Facebook, Instagram, Twitter and YouTube. Furthermore, a qualitative software analysis of NVivo 12 Plus is used in performing the analytical procedures.

Findings

This work explains the means of digital zakat campaign during COVID-19 outbreak with a case of BAZNAS RI. It is identified the number of 6 parent nodes and 64 child nodes from the analysis using NVivo 12 Plus. The authors’ parent nodes are “donation”, “infaq” (Islamic spending for charities), “Ramaḍān matters”, “ṣadaqah” (voluntary charity), “virtual events” and “zakat”. These nodes detail digital campaign of BAZNAS RI posted in its social media during COVID-19 period in Ramaḍān. A theoretical implication of inclusive marketing is derived from the analysis. It explains that the inclusiveness of digital contents is practically significant in campaigning zakat as a religious obligation that contributes to social and financial benefits.

Research limitations/implications

This paper does not claim a positivist perspective on the relationship between digital zakat campaign and zakat collection. Instead, this paper explores in-depth the practice of digital zakat campaign, which the previous study confirms its association with a muzakki’s (Muslims who are obliged to pay zakat) decision to pay zakat.

Practical implications

This paper establishes the Islamic marketing theory that is derived from industrial practices. The inclusiveness of digital contents in zakat campaign is critical in activating zakat as a religious obligation that authentically shapes the social and economic processes of a Muslim community. This theory is practically important for 'amils (employees) of zakat institution who work in the marketing division, chiefly to create such contents to post in social media.

Social implications

The authors’ node of zakat distribution for COVID-19 relief indicates the importance of a formalised zakat institution to actualise zakat’s role in handling socioeconomic problems. Thus, paying zakat formally in an authorised organisation may contribute to a greater social contribution and maṣlaḥah (public interest) than paying it informally without any effective measurement.

Originality/value

This study contributes to the novelty in the Islamic marketing debate within two folds. First, this paper is among the pioneers in studying digital zakat campaign during COVID-19 outbreak by using a netnographic approach. Therefore, a theoretical implication derived from industrial practices is contributed. Second, this paper details the steps in using NVivo 12 Plus to analyse the unstructured data sampled from the internet. The future studies may thus refer to this work to understand the application of netnography and the procedures in analysing data from social media using this software.

Details

Journal of Islamic Marketing, vol. 12 no. 3
Type: Research Article
ISSN: 1759-0833

Keywords

Content available
Article
Publication date: 1 October 2019

Fahmi Ali Hudaefi and Kamaruzaman Noordin

This paper aims to develop a performance measure for Islamic banks (IBs) by harmonizing related studies. Furthermore, this work uses the developed yardstick to analyze the…

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Abstract

Purpose

This paper aims to develop a performance measure for Islamic banks (IBs) by harmonizing related studies. Furthermore, this work uses the developed yardstick to analyze the performance of a sample of 11 IBs from across different countries.

Design/methodology/approach

This paper uses the mix-mode method. The qualitative approach is engaged first to construct the IBs performance yardstick. Following this, the quantitative approach is applied through the use of the performance yardstick to measure the sample’s performance.

Findings

This study develops a maqāṣid-based performance yardstick adapted from previous works. The developed model in this study is called an integrated maqāṣid al-Sharīʿah--based performance measure (IMSPM). By using this performance measure, the present paper finds that the sample performed highest on the objective of nafs (self) over the three-year period. In addition, this study identifies the information which best indicates the sample’s performance during the analysis.

Research limitations/implications

This paper uses the sample’s annual reports. The analysis is thus limited to informational disclosure.

Practical implications

Islamic banking and financial institutions may use the IMSPM to communicate a measurable report on their promotion of the maqāṣid al-Sharīʿah (objectives of Islamic law).

Social implications

The evidence from 11 IBs is indicative of their efforts to realize maqāṣid al-Sharīʿah in the banking industry. This point may best challenge the practice of stigmatizing IBs for not being in line with the Sharīʿah (Islamic law) or of imitating conventional banks.

Originality/value

The novelty of this study lies in two points. First, this study harmonizes previous works to integrate financial and religious measures in a single yardstick. Second, by using the developed standard, this study offers a fresh insight into the global IBs’ performance, represented by 11 IBs worldwide.

Details

ISRA International Journal of Islamic Finance, vol. 11 no. 2
Type: Research Article
ISSN: 0128-1976

Keywords

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Article
Publication date: 5 November 2021

M. Kabir Hassan, Fahmi Ali Hudaefi and Rezzy Eko Caraka

This paper aims to explore netizen’s opinions on cryptocurrency under the lens of emotion theory and lexicon sentiments analysis via machine learning.

Abstract

Purpose

This paper aims to explore netizen’s opinions on cryptocurrency under the lens of emotion theory and lexicon sentiments analysis via machine learning.

Design/methodology/approach

An automated Web-scrapping via RStudio is performed to collect the data of 15,000 tweets on cryptocurrency. Sentiment lexicon analysis is done via machine learning to evaluate the emotion score of the sample. The types of emotion tested are anger, anticipation, disgust, fear, joy, sadness, surprise, trust and the two primary sentiments, i.e. negative and positive.

Findings

The supervised machine learning discovers a total score of 53,077 sentiments from the sampled 15,000 tweets. This score is from the artificial intelligence evaluation of eight emotions, i.e. anger (2%), anticipation (18%), disgust (1%), fear (3%), joy (15%), sadness (3%), surprise (7%), trust (15%) and the two sentiments, i.e. negative (4%) and positive (33%). The result indicates that the sample primarily contains positive sentiments. This finding is theoretically significant to measure the emotion theory on the sampled tweets that can best explain the social implications of the cryptocurrency phenomenon.

Research limitations/implications

This work is limited to evaluate the sampled tweets’ sentiment scores to explain the social implication of cryptocurrency.

Practical implications

The finding is necessary to explain the recent phenomenon of cryptocurrency. The positive sentiment may describe the increase in investment in the decentralised finance market. Meanwhile, the anticipation emotion may illustrate the public’s reaction to the bubble prices of cryptocurrencies.

Social implications

Previous studies find that the social signals, e.g. word-of-mouth, netizens’ opinions, among others, affect the cryptocurrencies’ movement prices. This paper helps explain the social implications of such dynamic of pricing via sentiment analysis.

Originality/value

This study contributes to theoretically explain the implications of the cryptocurrency phenomenon under the emotion theory. Specifically, this study shows how supervised machine learning can measure the emotion theory from data tweets to explain the implications of cryptocurrencies.

Details

Studies in Economics and Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1086-7376

Keywords

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Article
Publication date: 21 October 2021

Rezzy Eko Caraka, Fahmi Ali Hudaefi, Prana Ugiana, Toni Toharudin, Avia Enggar Tyasti, Noor Ell Goldameir and Rung Ching Chen

Despite the practice of credit card services by Islamic financial institutions (IFIs) is debatable, Islamic banks (IBs) have been offering this product. Both Muslim and…

Abstract

Purpose

Despite the practice of credit card services by Islamic financial institutions (IFIs) is debatable, Islamic banks (IBs) have been offering this product. Both Muslim and non-Muslim customers have subscribed to the products. Thus, it is critical to analyse the strategy of IBs’ moral messages in reminding their Muslim and non-Muslim customers to repay their credit card debts. This paper aims to investigate this issue in Indonesia using data mining via machine learning.

Design/methodology/approach

This study examines the IBs’ customers across the 32 provinces of Indonesia regarding their moral status in credit card debt repayment. This work considers 6,979 observations of the variables that affect the moral status of the IBs’ customers in repaying their debt. The five types of data mining via machine learning (i.e. Boruta, logistic regression, Bayesian regression, random forest, XGBoost and spatial cluster) are used. Boruta, random forest and XGBoost are used to select the important features to investigate the moral aspects. Bayesian regression is used to get the odds and opportunity for the transition of each variable and spatially formed based on the information from the logistical intercepts. The best method is selected based on the highest accuracy value to deliver the information on the relationship between moral status categories in the selected 32 provinces in Indonesia.

Findings

A different variable on moral status in each province is found. The XGBoost finds an accuracy value of 93.42%, which the three provincial groups have the same information based on the importance of the variables. The strategy of IBs’ moral messages by sending the verse of al-Qur’an and al-Hadith (traditions or sayings of the Prophet Muhammad PBUH) and simple messages reminders do not impact the customers’ repaying their debts. Both Muslim and non-Muslim groups are primarily found in the non-moral group.

Research limitations/implications

This study does not consider socio-economic demographics and culture. This limitation calls future works to consider such factors when conducting a similar topic.

Practical implications

The industry professionals can take benefit from this study to understand the Indonesian customers’ moral status in repaying credit card debt. In addition, future works may advance the recent findings by considering socio-cultural factors to investigate the moral status approach to Islamic credit warnings that is not covered by this study.

Social implications

This work finds that religious text of credit card repayment reminders sent to Muslims in several provinces of Indonesia does not affect their decision to repay their debts. To some extent, this finding draws a social issue that the local IBs need to consider when implementing the strategy of credit card repayment reminders.

Originality/value

This study credits a novelty in the discourse of data science for Islamic finance practices. Specifically, this study pioneers an example of using data mining to investigate Islamic-moral incentives in credit card debt repayment.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8394

Keywords

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Article
Publication date: 8 October 2020

Ahmad Baehaqi, M. Nur A. Birton and Fahmi Ali Hudaefi

This paper aims to critically analyse the application of present value (PV) practised in the concept of time value of money (TVM) from the perspective of maqāṣid…

Abstract

Purpose

This paper aims to critically analyse the application of present value (PV) practised in the concept of time value of money (TVM) from the perspective of maqāṣid al-Sharī‘ah (objective of Islamic law) explained by Ibn ‘Ashur. The analysis is important as this concept has been adopted in the practice of Islamic accounting measurement.

Design/methodology/approach

This paper uses qualitative research approach. The authors first review literature related to TVM in Islamic perspective to understand the extent to which the scholarly articles have been discussing this topic. Furthermore, the authors conduct face-to-face interviews with the experts to comprehend the means of TVM application in the recent Islamic accounting practices. The tawhid (monotheistic) paradigm is further used with special reference to the concept of maqāṣid al-Sharī‘ah of Ibn ‘Ashur to critically analyse the practice of TVM in Islamic accounting measurement.

Findings

This study identifies the opposing views among the experts on the topic of TVM from the Islamic perspective. That is, the experts’ opinion on this issue can be classified into two. Firstly, a view that rejects TVM and proposes the concept of economic value of time. Secondly, an opinion that recognises TVM with the basis of bay’ al-mu’ajjal (deferred sale). This paper further critically analyses these two opposing opinions. The discussion is established based on the theory of maqāṣid al-Sharī‘ah as explained by Ibn ‘Ashur and the excerpts from interviewing the experts. This work draws a conclusion that such PV-based measurement of TVM does not meet the Islamic principles explained in the theory of Ibn ‘Ashur’s maqāṣid al-Sharī‘ah. Thus, the practice of PV measurement in Islamic accounting is debatable.

Research limitations/implications

This study does not establish a positivism discussion. It is thus the generalisation of this work is not applicable to the Islamic perspective in general. Rather, it is limited to Ibn ‘Ashur’s maqāṣid al-Sharī‘ah.

Practical implications

An analysis of PV measurement adoption in Islamic accounting from maqāṣid al-Sharī‘ah perspective is practically important to raise the awareness that such practice is debatable in Islamic principles. That is, such debate opens new arena for academics, industry professionals and other related stakeholders to further discuss an ideal practice of Islamic accounting.

Originality/value

This paper is among the pioneers that analyses the concept of TVM, in particular relation to PV measurement in Islamic accounting practice from the perspective of Ibn ‘Ashur’s maqāṣid al-Sharī‘ah.

Details

Journal of Islamic Accounting and Business Research, vol. 11 no. 9
Type: Research Article
ISSN: 1759-0817

Keywords

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Article
Publication date: 14 March 2020

Fahmi Ali Hudaefi

This study aims to explore the existing Islamic financial technology (fintech) lending in Indonesia. Doing so is to better understand in what way the fintech firms have…

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1104

Abstract

Purpose

This study aims to explore the existing Islamic financial technology (fintech) lending in Indonesia. Doing so is to better understand in what way the fintech firms have been promoting the global movement of sustainable development goals (SDGs) in the local context.

Design/methodology/approach

This study engages qualitative methods. This paper first reviews relevant literature related to fintech and establishes the substantive definition of Islamic fintech. Further, the existing literature of SDGs is explored to understand its original idea and its recent implementation, particularly in Indonesia. Following this, the official reports from the domestic regulators are referred to select the fintech firms which meet the criteria of Islamic fintech lending based on the proposed definition. The selected firms are then analysed based on several themes which best capture their position in promoting the SDGs. Finally, the discussion is linked to the recent performance of Indonesia in implementing SDGs.

Findings

This work finds that the reviewed fintech firms have been promoting the idea of financial inclusion, for example, financing the underdeveloped sectors such as agriculture and small and micro enterprises (SMEs). Furthermore, the selected fintech firms are also found to collect and distribute Islamic social funds such as infaq (charity spending), waqf (endowment) and sadaqah (voluntary charity). Besides, the firms are also found to initiate charity programmes for underprivileged community. In some degree, these findings are synonymous of the firms’ effort in promoting SDG of ending poverty (SDG 1) and hunger (SDG 2) and reducing the inequalities (SDG 10).

Research limitations/implications

The discussion of this work does not provide any positivist generalisation due to the method used.

Practical implications

The Indonesian Government is advised to legally engage with the existing fintech firms and other related stakeholders to best solve its recent issue of the declining trend in SDG 15 (life on land).

Social implications

This work elaborates in what way the Islamic fintech lending has been promoting the SDGs in Indonesian context. In some extent, such discussion can best challenge the social issue of fintech which has been stigmatised of bringing mafsadah (harm), as subjectively claimed by one particular religious group in Indonesia.

Originality/value

This study is among the pioneers which offers the definition of Islamic fintech and further explains its position in endorsing the global movement of SDGs.

Details

Qualitative Research in Financial Markets, vol. 12 no. 4
Type: Research Article
ISSN: 1755-4179

Keywords

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Article
Publication date: 3 June 2019

Fahmi Ali Hudaefi and Neni Heryani

This paper aims to study the Pesantren’s role in alleviating the poverty in rural region, and the discussion is connected to the theory of local economic development and…

Abstract

Purpose

This paper aims to study the Pesantren’s role in alleviating the poverty in rural region, and the discussion is connected to the theory of local economic development and Maqāṣid al-Sharī‘ah.

Design/methodology/approach

This paper engages a case study and an interview to get insight into the subject matters.

Findings

This study finds that the roles of an entrepreneur and a stimulator are evident from the sampled Pesantren in empowering the local economy and the underprivileged community. Further, inasmuch as the fundamental concept of local economic development is in line with Maqāṣid al-Sharī‘ah, the evidence from the sampled Pesantren is also representative of its role in actualising it. This study is relevant for academics, local government in Indonesia and other related stakeholders.

Practical implications

This paper credits both theoretical and practical implications for academics and the government. Firstly, by discussing the concept of prosperity from the Western and Islamic perspective, this paper creates a notion that these theories are harmonisable. Secondly, by sampling a Pesantren to draw how these two concepts are applied to advance a rural economy, this paper comes out with the hands-on advice for Indonesian government to legally engage with the existing Pesantrens to perform its rural development programmes.

Social implications

While a Pesantren’s role in empowering a disadvantaged community is comprehensively investigated, an accurate evidence is documented which can best challenge its radicalism and terrorism issues.

Originality/value

This is the first study to harmonise the theory of local economic development and Maqāṣid al-Sharī‘ah and presents the practical evidence from a Pesantren.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 12 no. 5
Type: Research Article
ISSN: 1753-8394

Keywords

Content available
Article
Publication date: 9 December 2019

Beebee Salma Sairally

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335

Abstract

Details

ISRA International Journal of Islamic Finance, vol. 11 no. 2
Type: Research Article
ISSN: 0128-1976

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