Islamic Fintech Growth Prospects in Accelerating MSMEs Growth during the Covid-19 Pandemic: Evidence in Indonesia

Year 2021, Volume: 7 Issue: 2, 126 - 140, 31.07.2021

Muhammad Iqbal , Prameswara Nadya Saripudin Saripudin

https://doi.org/10.25272/ijisef.857488

Abstract

Islamic fintech plays a role in encouraging the growth of micro, small and medium enterprises (MSMEs) in Indonesia with their financing segments. The bigger the Islamic fintech, the faster the growth of MSMEs in Indonesia. This study aims to identify macroeconomic factors such as gross domestic product (GDP), interest rates and inflation in driving the growth of Islamic fintech. Using the Ordinary Least Squared (OLS) regression method, the results show that GDP and inflation have a positive effect on the growth of Islamic fintech, while interest rates have a negative effect on the growth of Islamic fintech. Improving macroeconomic conditions will encourage the growth of Islamic fintech which in turn will contribute to the growth of MSMEs, which are the main segment of Islamic fintech financing.

Keywords

islamic fintech, gross domestic product, interest rate, inflation

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