Innovation and Digital Transformation in Islamic Economics: Strengthening Sustainable Resilience and Inclusive Growth

Abstract

This paper examines the transformative role of innovation and digital technologies within Islamic economics in strengthening sustainable resilience and inclusive growth. Drawing from a comprehensive literature review and policy analysis, the study highlights four key areas of digital integration: Islamic financial innovation, digital zakat and waqf management, halal supply chain digitalization, and regulatory support for inclusive growth. By synthesizing national and international case studies, the paper shows how mobile banking, blockchain-based waqf, and digital halal certification enhance transparency, efficiency, and financial inclusion, particularly for micro and small enterprises and underserved populations. The findings suggest that digital transformation not only improves institutional agility and crisis response but also reinforces the ethical principles of Islamic economics, including social justice, risk-sharing, and wealth redistribution. This research also introduces a conceptual framework demonstrating the pathways through which digital innovation contributes to resilience and inclusivity. The results offer practical implications for policymakers, Islamic economic institutions, and scholars seeking to leverage digital technology as a strategic tool for sustainable development in alignment with the UN Sustainable Development Goals (SDGs).