The Role of Islamic Social Finance in Supporting the Achievement of Sustainable Development Goals: A Literature Review

Abstract

Islamic Social Finance (ISF) holds strategic potential in supporting the achievement of the Sustainable Development Goals (SDGs) through key instruments such as zakat, waqf, and qard al?hasan. This study is motivated by the need to maximize the contribution of ISF to inclusive and sustainable development, while also bridging socio-economic gaps and global funding for the SDGs agenda. The research employs a qualitative approach using a library research method, analyzing secondary data from reputable journal articles, academic books, and relevant scholarly publications. The analysis is conducted through thematic descriptive methods to explore the contributions, challenges, and optimization strategies of ISF in the context of the SDGs. The findings indicate that ISF plays a significant role in wealth redistribution, economic empowerment of vulnerable communities, strengthening social inclusion, and providing long-term financing through productive zakat, productive waqf, and Islamic microfinance. However, its implementation faces challenges including limited funding, low product innovation, regulatory gaps, and limited public literacy. This study emphasizes that optimizing ISF through institutional professionalization, digitalization, policy integration, and the internalization of Islamic ethical values can accelerate the achievement of the SDGs in an inclusive, sustainable, and equitable manner. These findings provide valuable references for both academic research and policy practice to maximize the role of Islamic social finance in global development.