Socioeconomic Issues in Zakat Microfinance Innovation: Evidence from Cyberspace

Abstract

This paper explores socioeconomic issues faced by marginalized MSME (Micro, Small, and Medium Enterprises) entrepreneurs that drives the innovation of zakat microfinance in Indonesia. A single case study from Indonesia’s zakat board (Baznas RI) was performed, using the unstructured data sampled from its YouTube videos and website contents. This study primarily relies on qualitative inductive reasoning for qualitative data analysis. The finding identifies that poverty, lack of access to formal financial services, and dealing with loan sharks as the socioeconomic problems faced by the marginalized small entrepreneurs that drive zakat microfinance innovation. This finding draws practical implications for further investigation, the degree to which zakat microfinance promotes social innovation, whether it offers a viable solution to reduce poverty, promote financial inclusion, and fight loan shark dependency among those marginalized entrepreneurs.