The potentials of internalising social banking among the Malaysian Islamic banks

Research output: Contribution to journalArticle

5 Citations (Scopus)

Abstract

Islamic banking has established for the last 40 years, yet only recently researchers acknowledge social failures of Islamic banking and finance. This has led to a proposition of forming new forms of banking and non-banking institutions that include social banking. It is argued that in considering the developmentalist needs of the Muslim societies in Malaysia, there is a need to go back to fundamentals of Islamic finance in realising the aspirational Islamic moral economy that emphasises on the social good, capacity development at the individual and social levels. This paper aims to explore the concept of social banking and search for the possibilities for internalisation in Malaysian Islamic banking. To gain understanding on this pertinent issue, an empirical investigation was conducted at 17 Islamic banks in Malaysia. A mixed method was employed. For the primary data collection, 477 respondents of Islamic banks clients and employees participated in a self-administrated survey, and 11 respondents from the executive and managerial level of eight Islamic banks involved in a semi-structured interview survey. The integrated analysis implies that Islamic banking significantly contributes to socio-economic development. On the contrary, financial and economic practices in everyday life do not reflect the social economic justice. The result further illustrates that the Islamic banks lack social contributions as they prone to practice efficiency-oriented institutions. Hence, a social banking model is needed to solve the lack of socio-economic development issue in the current practice of Islamic bank.

Original languageEnglish
Pages (from-to)347-372
Number of pages26
JournalEnvironment, Development and Sustainability
Volume18
Issue number2
DOIs
Publication statusPublished - 1 Apr 2016

Fingerprint

banking
bank
finance
Malaysia
economic development
economics
Islamic financial institutions
Banking
internalization
lack
social economics
Islamic banking
everyday life
Muslim
justice
employee
efficiency
economy
interview
society

Keywords

  • Islamic banking
  • Islamic moral economy
  • Malaysia
  • Social banking

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Management, Monitoring, Policy and Law
  • Economics and Econometrics

Cite this

@article{7c18bd549a34453b91824f9b7e247f01,
title = "The potentials of internalising social banking among the Malaysian Islamic banks",
abstract = "Islamic banking has established for the last 40 years, yet only recently researchers acknowledge social failures of Islamic banking and finance. This has led to a proposition of forming new forms of banking and non-banking institutions that include social banking. It is argued that in considering the developmentalist needs of the Muslim societies in Malaysia, there is a need to go back to fundamentals of Islamic finance in realising the aspirational Islamic moral economy that emphasises on the social good, capacity development at the individual and social levels. This paper aims to explore the concept of social banking and search for the possibilities for internalisation in Malaysian Islamic banking. To gain understanding on this pertinent issue, an empirical investigation was conducted at 17 Islamic banks in Malaysia. A mixed method was employed. For the primary data collection, 477 respondents of Islamic banks clients and employees participated in a self-administrated survey, and 11 respondents from the executive and managerial level of eight Islamic banks involved in a semi-structured interview survey. The integrated analysis implies that Islamic banking significantly contributes to socio-economic development. On the contrary, financial and economic practices in everyday life do not reflect the social economic justice. The result further illustrates that the Islamic banks lack social contributions as they prone to practice efficiency-oriented institutions. Hence, a social banking model is needed to solve the lack of socio-economic development issue in the current practice of Islamic bank.",
keywords = "Islamic banking, Islamic moral economy, Malaysia, Social banking",
author = "{Mohd Nor}, Shifa and {Abdul Rahim}, Ruzita and {Che Senik}, Zizah",
year = "2016",
month = "4",
day = "1",
doi = "10.1007/s10668-015-9651-0",
language = "English",
volume = "18",
pages = "347--372",
journal = "Environment, Development and Sustainability",
issn = "1387-585X",
publisher = "Springer Netherlands",
number = "2",

}

TY - JOUR

T1 - The potentials of internalising social banking among the Malaysian Islamic banks

AU - Mohd Nor, Shifa

AU - Abdul Rahim, Ruzita

AU - Che Senik, Zizah

PY - 2016/4/1

Y1 - 2016/4/1

N2 - Islamic banking has established for the last 40 years, yet only recently researchers acknowledge social failures of Islamic banking and finance. This has led to a proposition of forming new forms of banking and non-banking institutions that include social banking. It is argued that in considering the developmentalist needs of the Muslim societies in Malaysia, there is a need to go back to fundamentals of Islamic finance in realising the aspirational Islamic moral economy that emphasises on the social good, capacity development at the individual and social levels. This paper aims to explore the concept of social banking and search for the possibilities for internalisation in Malaysian Islamic banking. To gain understanding on this pertinent issue, an empirical investigation was conducted at 17 Islamic banks in Malaysia. A mixed method was employed. For the primary data collection, 477 respondents of Islamic banks clients and employees participated in a self-administrated survey, and 11 respondents from the executive and managerial level of eight Islamic banks involved in a semi-structured interview survey. The integrated analysis implies that Islamic banking significantly contributes to socio-economic development. On the contrary, financial and economic practices in everyday life do not reflect the social economic justice. The result further illustrates that the Islamic banks lack social contributions as they prone to practice efficiency-oriented institutions. Hence, a social banking model is needed to solve the lack of socio-economic development issue in the current practice of Islamic bank.

AB - Islamic banking has established for the last 40 years, yet only recently researchers acknowledge social failures of Islamic banking and finance. This has led to a proposition of forming new forms of banking and non-banking institutions that include social banking. It is argued that in considering the developmentalist needs of the Muslim societies in Malaysia, there is a need to go back to fundamentals of Islamic finance in realising the aspirational Islamic moral economy that emphasises on the social good, capacity development at the individual and social levels. This paper aims to explore the concept of social banking and search for the possibilities for internalisation in Malaysian Islamic banking. To gain understanding on this pertinent issue, an empirical investigation was conducted at 17 Islamic banks in Malaysia. A mixed method was employed. For the primary data collection, 477 respondents of Islamic banks clients and employees participated in a self-administrated survey, and 11 respondents from the executive and managerial level of eight Islamic banks involved in a semi-structured interview survey. The integrated analysis implies that Islamic banking significantly contributes to socio-economic development. On the contrary, financial and economic practices in everyday life do not reflect the social economic justice. The result further illustrates that the Islamic banks lack social contributions as they prone to practice efficiency-oriented institutions. Hence, a social banking model is needed to solve the lack of socio-economic development issue in the current practice of Islamic bank.

KW - Islamic banking

KW - Islamic moral economy

KW - Malaysia

KW - Social banking

UR - http://www.scopus.com/inward/record.url?scp=84961184260&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84961184260&partnerID=8YFLogxK

U2 - 10.1007/s10668-015-9651-0

DO - 10.1007/s10668-015-9651-0

M3 - Article

VL - 18

SP - 347

EP - 372

JO - Environment, Development and Sustainability

JF - Environment, Development and Sustainability

SN - 1387-585X

IS - 2

ER -