Bridging Faith and Innovation: A Systematic Literature Review of Islamic FinTech Adoption Patterns and Regulatory Frameworks (2020-2024)

Riza Eko Suswanto; Ickhsanto Wahyudi; Rahmawati Rahmawati; Muhammad Said

doi:10.15575/am.v12i1.41417

Bridging Faith and Innovation: A Systematic Literature Review of Islamic FinTech Adoption Patterns and Regulatory Frameworks (2020-2024)

Authors

Riza Eko Suswanto Universitas Islam Negeri Syarif Hidayatullah Jakarta
Ickhsanto Wahyudi Universitas Islam Negeri Syarif Hidayatullah Jakarta
Rahmawati Rahmawati Universitas Islam Negeri Syarif Hidayatullah Jakarta
Muhammad Said Universitas Islam Negeri Syarif Hidayatullah Jakarta

DOI:

https://doi.org/10.15575/am.v12i1.41417

Keywords:

Islamic FinTech, Shariah Compliance, Technology Adoption, Regulatory Framework, Financial Inclusion

Abstract

This systematic literature review critically examines the adoption and regulatory frameworks of Islamic Financial Technology (Islamic FinTech) across various jurisdictions between 2020 and 2024. Through an extensive analysis of 28 scholarly articles, the study identifies the key factors influencing adoption, regulatory challenges, and potential growth opportunities in the Islamic FinTech sector. The findings reveal that trust, religious orientation, and technological readiness significantly influence Islamic FinTech adoption. Additionally, the study identifies critical challenges, including Shariah compliance mechanisms, regulatory frameworks, and consumer protection. The novelty of this study lies in its systematic and holistic approach, integrating the analysis of adoption factors, regulatory challenges, and technological innovations within the context of Islamic FinTech. The research emphasizes the importance of developing a comprehensive regulatory framework that balances technological innovation with Shariah compliance, while ensuring consumer protection. This study contributes to the advancement of knowledge on Islamic FinTech by providing practical insights for policymakers, practitioners, and researchers in developing a sustainable Islamic FinTech ecosystem. Furthermore, the study offers concrete recommendations, such as the harmonization of international Shariah standards and the utilization of blockchain technology to enhance transparency, which can be applied in a global context.

References

Ali, M, S A Raza, B Khamis, C H Puah, and H Amin. “How Perceived Risk, Benefit and Trust Determine User Fintech Adoption: A New Dimension for Islamic Finance.” Foresight 23, no. 4 (2021): 403–20. https://doi.org/10.1108/FS-09-2020-0095.

Alsmadi, A A. “Exploring the Moderating Role of Religious Orientation on Islamic Fintech Adoption.” International Journal of Islamic and Middle Eastern Finance and Management 17, no. 2 (2024): 310–27. https://doi.org/10.1108/IMEFM-09-2023-0315.

Azman, N H N, M.Z.Md. Zabri, T A Masron, and N A K Malim. “The Utilisation Of Islamic Fintech (I-Fintech) In Promoting Sustainable Inclusive Growth: Evidence From Micro-Entrepreneurs In Malaysia.” Journal of Islamic Monetary Economics and Finance 6, no. 3 (2020): 555–76. https://doi.org/10.21098/jimf.v6i3.1180.

Bakri, M H, N A Abdul Aziz, M I Md Razak, M H Abdul Hamid, M Z Md Nor, and A A Iskandar Mirza. “Acceptance Of Ddkoin Blockchain Using Utaut Model: A Customer Perspective Approach.” Quality - Access to Success 24, no. 192 (2023): 103–21. https://doi.org/10.47750/QAS/24.192.13.

Bakri, M H, K.K.S.M. Almansoori, and N S M Azlan. “Determinants Intention Usage of Islamic E-Wallet Among Millennials.” Global Business and Finance Review 28, no. 1 (2023): 11–32. https://doi.org/10.17549/gbfr.2023.28.1.11.

Bin-Nashwan, S A, A E A Ismaiel, A Muneeza, and M Y Isa. “Adoption of ZakaTech in the Time of COVID-19: Cross-Country and Gender Differences.” Journal of Islamic Marketing 14, no. 11 (2023): 2949–79. https://doi.org/10.1108/JIMA-08-2021-0278.

Chong, Felicia Hui Ling. “Enhancing Trust through Digital Islamic Finance and Blockchain Technology.” Qualitative Research in Financial Markets 13, no. 3 (January 1, 2021): 328–41. https://doi.org/10.1108/QRFM-05-2020-0076.

Hudaefi, F A. “How Does Islamic Fintech Promote the SDGs? Qualitative Evidence from Indonesia.” Qualitative Research in Financial Markets 12, no. 4 (2020): 353–66. https://doi.org/10.1108/QRFM-05-2019-0058.

Hudaefi, Fahmi Ali, M Kabir Hassan, and Muhamad Abduh. “Exploring the Development of Islamic Fintech Ecosystem in Indonesia: A Text Analytics.” Qualitative Research in Financial Markets 15, no. 3 (January 1, 2023): 514–33. https://doi.org/10.1108/QRFM-04-2022-0058.

Irimia-Diéguez, A, G Albort-Morant, M D Oliver-Alfonso, and S Ullah. “Predicting the Intention to Use Paytech Services by Islamic Banking Users.” International Journal of Islamic and Middle Eastern Finance and Management 17, no. 1 (2024): 1–15. https://doi.org/10.1108/IMEFM-07-2022-0298.

Kholidah, H, B A Fianto, S Herianingrum, S Ismail, and P A Mohd Hidzir. “Do Islamic Fintech Lending Promote Microenterprises Performance in Indonesia? Evidence of Difference-in-Difference Model.” International Journal of Islamic and Middle Eastern Finance and Management, 2024. https://doi.org/10.1108/IMEFM-08-2023-0310.

Maniam, S. “Determinants of Islamic Fintech Adoption: A Systematic Literature Review.” Journal of Islamic Marketing 15, no. 11 (2024): 2916–36. https://doi.org/10.1108/JIMA-11-2023-0373.

Mohd, N, M Razali, M H Yahaya, and Z N Baharuddin. “The Roles of Islamic Financial Technology (FINTECH) in Fostering Financial Inclusion in Malaysia.” Management and Accounting Review 23, no. 1 (2024): 329–55.

Muryanto, Yudho Taruno. “The Urgency of Sharia Compliance Regulations for Islamic Fintechs: A Comparative Study of Indonesia, Malaysia and the United Kingdom.” Journal of Financial Crime 30, no. 5 (January 1, 2023): 1264–78. https://doi.org/10.1108/JFC-05-2022-0099.

Nagimova, A Z. “Islamic Finance in Kazakhstan: The View of Experts.” Journal of Islamic Accounting and Business Research 14, no. 8 (2023): 1195–1215. https://doi.org/10.1108/JIABR-09-2021-0265.

Nurfadilah, D, and S Samidi. “How The Covid-19 Crisis Is Affecting Customers’ Intention To Use Islamic Fintech Services: Evidence From Indonesia.” Journal of Islamic Monetary Economics and Finance 7 (2021): 83–114. https://doi.org/10.21098/jimf.v7i0.1318.

Rabbani, M R, S Khan, and M Atif. “Machine Learning-Based P2P Lending Islamic Fintech Model for Small and Medium Enterprises in Bahrain.” International Journal of Business Innovation and Research 30, no. 4 (2023): 565–79. https://doi.org/10.1504/IJBIR.2023.130079.

Rabbani, M R, S Khan, and E I Thalassinos. “FinTech, Blockchain and Islamic Finance: An Extensive Literature Review.” International Journal of Economics and Business Administration 8, no. 2 (2020): 65–86. https://doi.org/10.35808/ijeba/444.

Rahayu, R, S Ali, R Hidayah, and S Nabila. “Determinant Factors of Islamic Financial Technology Acceptance Evidence from Indonesia.” Journal of Telecommunications and the Digital Economy 12, no. 1 (2024): 405–26. https://doi.org/10.18080/jtde.v12n1.790.

Rahim, N F, M H Bakri, B A Fianto, N Zainal, and S A Hussein Al Shami. “Measurement and Structural Modelling on Factors of Islamic Fintech Adoption among Millennials in Malaysia.” Journal of Islamic Marketing 14, no. 6 (2023): 1463–87. https://doi.org/10.1108/JIMA-09-2020-0279.

Razak, M I A, N A M Dali, G Dhillon, and A W A Manaf. “Fintech in Malaysia: An Appraisal to the Need of Shariah-Compliant Regulation.” Pertanika Journal of Social Sciences and Humanities 28, no. 4 (2021): 3223–33. https://doi.org/10.47836/PJSSH.28.4.40.

Shaikh, I M, M A Qureshi, K Noordin, J M Shaikh, A Khan, and M S Shahbaz. “Acceptance of Islamic Financial Technology (FinTech) Banking Services by Malaysian Users: An Extension of Technology Acceptance Model.” Foresight 22, no. 3 (2020): 367–83. https://doi.org/10.1108/FS-12-2019-0105.

Syed, M H, S Khan, M R Rabbani, and Y E Thalassinos. “An Artificial Intelligence and NLP Based Islamic FinTech Model Combining Zakat and Qardh-Al-Hasan for Countering the Adverse Impact of COVID 19 on SMEs and Individuals.” International Journal of Economics and Business Administration 8, no. 2 (2020): 351–64. https://doi.org/10.35808/IJEBA/466.

Zaman, A, I Tlemsani, R Matthews, and M A Mohamed Hashim. “Assessing the Potential of Blockchain Technology for Islamic Crypto Assets.” Competitiveness Review, 2023. https://doi.org/10.1108/CR-05-2023-0100.