Financial Alternative Resources Among Halal Entrepreneurs: Challenges to Adopt Islamic Financing in Business

Abstract

Halal and Islamic finance is under Islamic law and has been established in the context of halal economic development. This study aims to investigate the financial alternative resources among Halal entrepreneurs that may become a barrier in the adoption of Islamic financing among Halal Entrepreneurs. This study was employed a qualitative approach using interviews with halal food entrepreneurs. The result indicated that financial alternative resources of users and non-users of Islamic financing products are the reason for low adoption among Halal entrepreneurs. The implication of this study is the role of Islamic banking to educate the customers towards shariah practicing in the operations that would have an impact on customer decision to patronize Islamic financing products. This study’s finding is limited to producers of Halal Food Entrepreneur. Therefore, future research could extend beyond the current scope to Halal Pharmaceutical, Halal logistics, or Halal Cosmetic to investigate the research model in a different context. Also, future studies should include other Non-Muslim Halal entrepreneurs to enrich the attitude of Halal entrepreneurs towards Islamic financing adoption in their business survival.