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Financial Inclusion Through Islamic Finance: Measurement Framework

The promotion of achieving financial inclusion through Islamic finance is considered an agenda priority in many countries especially where Muslims population is dominant. While the importance of financial inclusion index is widely recognized, the literature lacks a constructive discussion on its mea...

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Main Authors: Junaidah Abu Seman, Avylin Roziana Mohd Ariffin
Format: Article
Language:English
Published: Universiti Sains Islam Malaysia 2019
Subjects:
Financial inclusion
index
Islamic finance
risk sharing/risk taking
wealth distribution
Online Access:http://ddms.usim.edu.my:80/jspui/handle/123456789/18091
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spelling my.usim-180912019-04-16T04:31:39Z Financial Inclusion Through Islamic Finance: Measurement Framework Junaidah Abu Seman Avylin Roziana Mohd Ariffin Financial inclusion index Islamic finance risk sharing/risk taking wealth distribution The promotion of achieving financial inclusion through Islamic finance is considered an agenda priority in many countries especially where Muslims population is dominant. While the importance of financial inclusion index is widely recognized, the literature lacks a constructive discussion on its measurement in the light of Islamic finance. Building on the recent papers on financial inclusion index, this paper addresses the dimensions and indicators related to the computation of financial inclusion index based on Islamic finance. Some evidences suggest that the measurement of index needs to take into consideration as many dimensions as possible that impact the factor studied. Hence, incorporating as many dimensions as possible will result in a more holistic of financial inclusion index in the light of Islamic finance’s core objectives. This paper attempts to fill this gap by proposing the founding principles in financial inclusion index based on Islamic finance. The principles incorporate the two-pillar approach (i.e. risksharing/risk taking and wealth distribution) in determining the basic dimensions and indicators within the ambit of Islamic finance. By doing so, we hope to shed light on the parameters that are crucial in the index computation.As far as financial inclusion index is concerned, the issue of data limitation is expected in building this Islamic finance based index. With regard to the computation of financial inclusion index, while numerous amounts of data are available on many aspects of the financial sector, systematic indicators of inclusiveness of the financial sector are not. As a consequence, the second purpose of the paper is to examine the data available for the computation of financial inclusion index based on Islamic finance as well as issues pertaining to it. 2019-04-16T04:31:39Z 2019-04-16T04:31:39Z 2017-12 Article http://ddms.usim.edu.my:80/jspui/handle/123456789/18091 en Universiti Sains Islam Malaysia
institution Universiti Sains Islam Malaysia
building USIM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universit Sains Islam i Malaysia
content_source USIM Institutional Repository
url_provider http://ddms.usim.edu.my/
language English
topic Financial inclusion
index
Islamic finance
risk sharing/risk taking
wealth distribution
spellingShingle Financial inclusion
index
Islamic finance
risk sharing/risk taking
wealth distribution
Junaidah Abu Seman
Avylin Roziana Mohd Ariffin
Financial Inclusion Through Islamic Finance: Measurement Framework
description The promotion of achieving financial inclusion through Islamic finance is considered an agenda priority in many countries especially where Muslims population is dominant. While the importance of financial inclusion index is widely recognized, the literature lacks a constructive discussion on its measurement in the light of Islamic finance. Building on the recent papers on financial inclusion index, this paper addresses the dimensions and indicators related to the computation of financial inclusion index based on Islamic finance. Some evidences suggest that the measurement of index needs to take into consideration as many dimensions as possible that impact the factor studied. Hence, incorporating as many dimensions as possible will result in a more holistic of financial inclusion index in the light of Islamic finance’s core objectives. This paper attempts to fill this gap by proposing the founding principles in financial inclusion index based on Islamic finance. The principles incorporate the two-pillar approach (i.e. risksharing/risk taking and wealth distribution) in determining the basic dimensions and indicators within the ambit of Islamic finance. By doing so, we hope to shed light on the parameters that are crucial in the index computation.As far as financial inclusion index is concerned, the issue of data limitation is expected in building this Islamic finance based index. With regard to the computation of financial inclusion index, while numerous amounts of data are available on many aspects of the financial sector, systematic indicators of inclusiveness of the financial sector are not. As a consequence, the second purpose of the paper is to examine the data available for the computation of financial inclusion index based on Islamic finance as well as issues pertaining to it.
format Article
author Junaidah Abu Seman
Avylin Roziana Mohd Ariffin
author_facet Junaidah Abu Seman
Avylin Roziana Mohd Ariffin
author_sort Junaidah Abu Seman
title Financial Inclusion Through Islamic Finance: Measurement Framework
title_short Financial Inclusion Through Islamic Finance: Measurement Framework
title_full Financial Inclusion Through Islamic Finance: Measurement Framework
title_fullStr Financial Inclusion Through Islamic Finance: Measurement Framework
title_full_unstemmed Financial Inclusion Through Islamic Finance: Measurement Framework
title_sort financial inclusion through islamic finance: measurement framework
publisher Universiti Sains Islam Malaysia
publishDate 2019
url http://ddms.usim.edu.my:80/jspui/handle/123456789/18091
_version_ 1645154615704944640
score 13.211869

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