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The Role of Islamic Microfinance in Reducing Poverty and Improving Community Welfare in Indonesia

Year: 2025

Type: article

Abstract: This study investigates the role of Sharia microfinance in reducing poverty and improving community welfare in Indonesia, using a quantitative approach. A total of 70 respondents, primarily micro-entrepreneurs and low-income individuals, were surveyed using a 1-5 Likert scale questionnaire. Data analysis was conducted using SPSS version 25. The results indicate that access to Sharia microfinance services significantly contributes to financial stability, vincome generation, and overall community welfare. Specifically, Sharia microfinance was found to improve financial security, enhance income opportunities, and promote social empowerment. These findings highlight the potential of Sharia microfinance as a tool for poverty alleviation and sustainable development. This research provides important insights for policymakers and microfinance institutions to enhance the effectiveness of Sharia-based financial services in promoting economic and social well-being.

Source: West Science Social and Humanities Studies

DOI: 10.58812/wsshs.v3i02.1690

Authors: Loso Judijanto, Dila Padila Nurhasanah, Salwa Aulia Novitasari

Institution: Nusa Putra University

Language: English

Topic: Microfinance and Financial Inclusion

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: No poverty, Decent work and economic growth, Reduced inequalities

Open Access status: diamond

OpenAlex ID: W4408657131

FWCI: 0.973

Cites:

Cited by: 1

Related to: 10