Digital Innovation Capabilities and Islamic Social Finance Sustainability

In the rapidly evolving landscape of financial technology (FinTech), the intersection of digital innovation capabilities (DICs) and Islamic social finance presents a fertile ground for enhancing sustainability in financial practices. This study employs a qualitative approach, specifically content analysis of existing literature sourced from journal databases. This theoretical review explores how DICs encompassing digitalization and digital transformation can influence the sustainability of Islamic social finance initiatives. Islamic social finance, rooted in principles of social justice and equitable distribution, aims to address socio-economic challenges while adhering to Shariah compliance. By synthesizing current literature and theoretical frameworks, this review elucidates the potential strategies in optimizing Islamic social finance mechanisms, improving transparency, efficiency, and reach. The analysis highlights key digital innovations, such as blockchain, artificial intelligence (AI), and cloud computing (CC). The review also proposes a conceptual model for integrating DICs with Islamic social finance to foster greater sustainability. This theoretical examination offers insights into how digital advancements can support the long-term goals of Islamic social finance, contributing to both economic development and social welfare.