NPF Islamic banking needs to be resolved because it affects banking performance in terms of income and the quality of its productive assets. This study aims to solve problems of non-performing financing and assess and analyze whether the implementation of the Islamic Humanity model can reduce the problem of financing at Bank Syariah Mandiri Indonesia. The study uses qualitative method with Miles and Huberman approach for analizing data through four steps which are; (a) data collection (b) data reduction (c) data display, and (d) conclusion drawing/ verification. The results of the study found non performing financing can be reduced with using a new approach namely the Islamic Humanity Approach, which is an interaction between several aspects, namely (a) spiritual aspects, (b) economic aspects, (c) social aspects, and (d) justice aspects. The Islamic humanity model carried out in problem-solving activities at Bank Syariah Mandiri Indonesia includes a friendly approach, communication and deliberation in a family, respect for people, empathy, the concept of justice, and the concept of prayer. Islamic humanity approach shows success in reducing non-performing financing. The research concluded Islamic humanity as a new approach to reduce non-performing financing at Bank Syariah Mandiri Indonesia and it can be implemented to all Islamic banking in Indonesia.

The study investigates developing an Islamic student financing securitization model based on sukuk structures. This study employs sample of descriptive, analytical, and comparative analyses utilized to discuss a novel framework of Islamic securitization through the different structures of sukuk wakalah derived from asset securitization. The result served to investigate the use of Islamic student financing securitization in a Shariah-compliant manner, which would be implementable in Malaysia. It emphasized the sukuk structures based on the wakeel principle, which indicated a situation where a wakeel or representative appointment was made to manage a project on the behalf of the sukuk holder. The findings of this study supported the economic benefits obtained in the form of lower overall financing costs through the use of securitization for student financing in higher education. This paper offers important implications specifically for the creation of sukuk structures and issuing a highly graded and marketable sukuk, which are compliant towards global Shariah principles. The paper fills the gap perceived within the existing literature of Islamic finance by showing Islamic securitization via sukuk as a viable source of funds potential utilizable in stabilizing the securities market. It can also pose as a solution for securing a sustainable funding.

This paper investigates the impact of profit and loss sharing (PLS) contracts on non-performing financing of Islamic rural banks as Islamic small banks focus on small and medium enterprises at province level across country. Our study employs panel data, consisting of 142 Islamic rural banks and using quarterly data from 2013Q1 to 2018Q4, and splits them based on the bank’s size and geographical area. Both static and dynamic panel regressions are then applied. The results obviously indicate that a high proportion of profit and loss sharing contracts leads to high financing risk. The large Islamic banks encounter a higher non-performing financing stemming from profit and loss contracts compared to small Islamic banks. Profit and loss contracts also produce higher financing risk for Islamic banks outside Java, as those areas are less developed areas than Java itself. A more efficient Islamic bank is less financing risk. Income diversification lessens the impaired financing and, more particularly, large Islamic banks and Islamic banks located in Java much benefit by diversifying income and financing to lower financing risk. Our study suggests that Islamic rural banks may consider the optimal level of profit and loss sharing contracts to minimize financing risk.