Publication:
INCEIF impact index model (IIIM) for assessing material and spiritual welfare in Islamic social finance
Loading...
Abstracts views
35
Views & Download
19
Date
2026
SDG:
Abstract
This study proposes the INCEIF Impact Index Model (IIIM), a holistic measurement methodology framework, to measure the socioeconomic and spiritual impact of Islamic social finance (ISF) initiatives in Islamic banks. The model, grounded in maqasid al-Shari'ah (the higher objectives of Islamic law), aims to overcome the drawbacks of current evaluation instruments, which focus mainly on material or financial performance and fail to consider the spiritual, ethical, and moral aspects of falah (human well-being). This study is designed according to a qualitative conceptual research approach which focuses on creating the IIIM as a comprehensive framework for impact measurement of ISF initiatives. The systematic review of relevant literature, content analysis of Islamic sources, conceptual synthesis, and expert validation methods are used to develop the framework. The study aims to combine the material and spiritual aspects of human welfare into an integrated assessment system grounded in the concepts of tawhid (unity of knowledge) and maqasid al-Shari'ah. This paper proposes a six-dimensional impact framework comprising faith and ethics, human well-being, knowledge and education, family and society, economic justice, and environmental stewardship. The IIIM illustrates that ISF interventions have multidimensional effects that go beyond income and consumption to include ethical behaviour, spiritual resilience, social cohesion and sustainability. The model operationalises welfare within the maqasid hierarchy of necessities (daruriyat), needs (hajiyat) and refinements (tahsiniyat), and allows differentiating the progression of beneficiaries towards holistic well-being. The paper adds to the current body of knowledge by proposing a new integrative index that synthesises the maqasid al-Shari'ah principles, embeds the Ekonomi MADANI values, and integrates the Sustainable Development Goals (SDGs) within a single framework for assessing ISF initiatives. The present study focuses on the conceptual development of the IIIM and does not provide empirical findings or statistical validation of the proposed model. Future studies are needed to operationalise and test the model using large-scale empirical data, applying statistical techniques such as Principal Component Analysis (PCA) to ensure the proposed model is reliable and validate the constructs. Future research should also be undertaken to determine the model's applicability across different institutional contexts including zakat, waqf and takaful, and to use cross-country and time series data. The IIIM offers policymakers, regulators and Islamic financial institutions a methodological framework for quantifying, observing and enhancing the actual effects of ISF initiatives. It enables evidence-based decision making, prioritises programmes, and aligns Islamic finance with national development plans and international standards of sustainability.
Keywords
Financial inclusion , Impact measurement , Islamic social finance (ISF) , Ekonomi MADANI , Maqasid al-Shari'ah , Spiritual well-being , Sustainable Development Goals (SDGs)
Citation
Omar, M. A., A. Mohsin, M. I., Beik, I. S., & Mohd Zulkarnaini, S. (2026). INCEIF Impact Index Model (IIIM) for assessing material and spiritual welfare in Islamic social finance. International Journal of Islamic Finance and Sustainable Development, 18(3), 117-138. https://doi.org/10.55188/ijifsd.v18i3.1392
Publisher
ISRA Institute
Files
INCEIF_Impact_Index_Model_(IIIM)_for_assessing_material_and_spiritual_welfare_in_Islamic_social_finance_Mohd Azmi Omar et al.pdf
Size: 565.63 KBFormat: pdf
Views: 9 Downloads: 10