Title: Shariah rural bank in empowering the small and micro enterprises: strategies and differentiations

Authors: Muhammad Said; Abdul Hamid; Dudu Duswara Machmuddin

Addresses: Faculty of Economics and Business, Syarif Hidayatullah State Islamic University, Jakarta, Indonesia ' Faculty of Economics and Business, Syarif Hidayatullah State Islamic University, Jakarta, Indonesia ' Faculty of Law and Business, Langlang Buana University, Bandung, West Java, Indonesia

Abstract: This study aims at exploring the business networks of Shariah rural banks to compete in multi-business competition; the differentiation of BPRS in competitive business environments in building market share; and the domino effects of the Shariah rural bank lending activity in the community development of the rural areas. This study applied qualitative approach with in-depth interview with the manager, financing unit, financed customers and the micro and small enterprises actors, observation and documentation. The findings show that Shariah rural bank developed a market share network using religious emotion, approaching public figures, leaders of Islamic organisations, and individual customers including non-Muslim. SRB applied mosque-based empowerment to train the actors of SMEs, build product innovation and social capital. These differentiation indicates BPRS is not merely a business agent for the sake of economy but also carries out public education, and social function, especially in creating social cohesion, social responsibility and social solidarity and human capital.

Keywords: Shariah rural bank; SRB; human capital; social capital; product innovative; mosque.

DOI: 10.1504/IJBG.2020.107832

International Journal of Business and Globalisation, 2020 Vol.25 No.1, pp.3 - 22

Received: 07 Sep 2017
Accepted: 28 Jan 2018
Published online: 23 Jun 2020 *

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