Resistance and Adaptation to Digital Innovation in Islamic Banking: A Study of Practices, Perceptions, and Transformation
DOI:
https://doi.org/10.1229/tecempresarialjournal.v20i2.564Abstract
Islamic banking faces complex dynamics as demands for modernization increase while maintaining sharia principles as its primary foundation. Resistance to change, on the one hand, and the need to adapt to digital innovation and global regulations, on the other, place the sector at a strategic crossroads. In such a situation, the balance between technological modernization and the upholding of Sharia values is a key factor in ensuring the sustainability and competitiveness of Islamic banking. This study aims to analyze the implications of resistance and adaptation in shaping the direction of long-term transformation in Islamic banking and to examine the sector's potential to strengthen its position in the global financial system. The research method used is a qualitative approach with in-depth descriptive analysis, which examines the dynamics of resistance and adaptation in Islamic banking through a literature review and critical analysis. Data were obtained from various academic sources, industry reports, and relevant financial regulations. The results indicate that excessive resistance can hinder innovation, while excessive adaptation risks diminishing the authenticity of sharia values. Striking the right balance between the two forms the foundation for a sustainable transformation that is relevant to the needs of the times. Islamic banking also has a significant opportunity to strengthen its global presence, particularly by offering an ethical financial model increasingly sought after in modern financial systems. Ultimately, the sector's sustainability will be largely determined by its ability to integrate Sharia principles with the inevitable modernization.
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