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The Impact of Islamic Economics and Finance Courses on Islamic Financial Literacy of University Students
Mohamad Fany Alfarisi; Agestayani; Silvi Delviani

Faculty of Economics
Universitas Andalas


Abstract

In conjunction with the development of Islamic finance industry, Islamic economics and finance courses have been introduced since the last two decades in Indonesia. To train the talents for Islamic finance industry, a number of institutions have held and training sessions in the phase of Islamic finance development. We assigned a number of criteria to choose the sample namely, faculty of economics and business students in public university with the lenght of study period at least three semesters. To collect primary data, 421 sets of self-administered Islamic financial literacy questionnaire had been distributed to the target respondents. From the total distributed questionnaire, 300 of them were completed and included in the sample. Therefore the respond rate is 71.3%. 145 respondents are in the category of low Islamic financial knowledge, while 155 are in the category of sufficient. From 145 respondents with low Islamic financial knowledge 79 (66) have (not) taken (any) Islamic economics and finance courses. From 155 respondents with sufficient financial knowledge 114 (41) have (not) taken (any) Islamic economics and finance courses. Using Pearson Chi-Square (cross-tabs), the p value is less than 0.05. Therefore, we do not have enough evidence to accept the null hypothesis that there is no difference between the two groups regarding their profiency in Islamic financial knowledge. In view of this, it can be inferred that Islamic economics and finance courses have significant impact upon Islamic financial knowledge of public university students in Padang. INTRODUCTION There has been an increasing trend of the Islamic finance industry in Indonesia since the last two decades. Despite experiencing positive improvement in terms of a number of institutions, assets, revenues, and customers, Indonesian Islamic finance industry so far has not reached its optimum level. One factor that has led to such condition is the low score of Islamic financial literacy index. The latest survey conducted by the OJK of financial literacy finds that Islamic financial literacy of Indonesian consumer is 8.11% (Otoritas Jasa Keuangan, 2017). Moreover, the finding of the survey informs that student-s Islamic financial literacy index is among the lowest compared to other consumer group based on the profession category. Owing to this condition, the phenomenon needs to be observed thoroughly, particularly the current state of students- Islamic financial literacy index. RESEARCH METHOD This study explains the impact of Islamic economics courses on Islamic financial literacy of university students. Additionally, it intends to compare Islamic financial literacy of those who have taken Islamic and finance courses and those who have not. With respect to the approach, the current study will use a quantitative approach to explain the linkage between the two variables. The population of the present study is all currently enrolled faculty of economics students from public universities in Padang notably Universitas Andalas, Universitas Negeri Padang and Universitas Islam Negeri Imam Bonjol. The target respondents of the present study are students of faculty of economics and business with the study period at least three semesters. The sampling technique used is the purposive sampling method. A self administered questionnaire will be used to collect primary data from university students in Padang. To avoid confusion and any unnecessary errors during the survey, pretesting will be conducted to limited number of respondents. Pretesting is another type of pilot test that focuses on data collection activities, for instance using questionnaires (Cooper & Schindler, 2008). Having passed the pretesting stage, the next step is to distribute the questionnaires directly to the potential respondents. Completed questionnaires, therefore will be inputted to statistical software for further examinations. Variables Definition Measurement Islamic economics courses All related Islamic economics courses such as Islamic bank, Islamic capital market, fiqh muamalah Yes or No Islamic Financial knowledge Stock of knowledge specifically related to Islamic finance concepts and products (Azmi & Chong, n.d.) Multiple choice question, 1 score for correct answer and 0 otherwise. Islamic Financial behavior Financial decision making (Mandell & Klein, 2009) Likert scale Islamic Financial attitude How consumers attitude in certain financial experience Likert scale RESULTS AND DISCUSSION From the table 4.1, it can below observed that most respondents can answer the question correctly in question number two that asking about example of ribawi transaction (98%) and question number three about the element of akad (contract) in a transaction (83.7%). Meanwhile, question on akad for Islamic bank saving account (6) and characteristic of Islamic mutual funds (7) are the most questions that could not be answered correctly (13.7% both). Distribution of Responses to Islamic Financial Knowledge Questions No Question Responses Incorrect (%) Correct (%) 1 Meaning of riba 59.7 40.3 2 Example of ribawi transaction 2.0 98.0 3 Element of akad 16.3 83.7 4 The right akad for a transaction 67.0 33.0 5 Negative element of a transaction 38.7 61.3 6 Akad for Islamic bank saving account 86.3 13.7 7 Characteristic of Islamic mutual funds 86.3 13.7 8 Takaful 43.3 56.7 9 Sukuk 61.7 38.3 10 Mudharabah 85.0 15.0 CONCLUSION From the findings of present study it can be conclude that many respondents put more emphasize on syariah-compliant status of financial products prior putting their wealth in any Islamic investment schemes. Islamic bank saving account is the most chosen Islamic finance products in the present time as well as in the future time. With respect to the level of Islamic Financial Knowledge, most respondents can be categorized as sufficient knowledge. The present study finds that attending the formal Islamic Economics and Finance courses can positively contribute to a greater level of Islamic Financial Literacy. REFERENCES Abduh, M. (2016). Foundation of Islamic Finance. Kuala Lumpur: IIUM Press. Atkinson, A., & Messy, F.-A. (2011). Assessing Financial Literacy in 12 Countries (No. 01/2011-014). Azmi, M., & Chong, R. (n.d.). Financial Literacy : An Exploratory Review of the Literature and Future Research. BAYER, P. J., BERNHEIM, B. D., & SCHOLZ, J. K. (2009). the Effects of Financial Education in the Workplace: Evidence From a Survey of Employers. Economic Inquiry, 47(4), 605–624. https://doi.org/10.1111/j.1465-7295.2008.00156.x Blue, L., Grootenboer, P., & Brimble, M. (2014). Financial literacy education in the curriculum: Making the grade or missing the mark? International Review of Economics Education, 16(PA), 51–62. https://doi.org/10.1016/j.iree.2014.07.005 Conference, I. (2016). Proceeding of the 3, 2016(November), 277–287. Cooper, D. R., & Schindler, P. S. (2008). Business Research Methods (Internatio). New York: McGraw-Hill/Irwin. Furqani, H. (2017). Country Reports: The Current Situation oF Islamic Economics. Istanbul. Retrieved from http://www.ikam.org.tr/en/publications/the-current-situation-of-islamic-economics-in-indonesia Hung, A. A., Parker, A. M., & Yoong, J. K. (2009). Defining and Measuring Financial Literacy (Labor and Population No. WR-708). Iqbal, Z., & Mirakhor, A. (2011). An Introduction to Islamic Finance: Theory and Practice (Second edi). Singapore: John Wiley & Sons Ltd. Lee, N. (n.d.). What is financial literacy , and does financial literacy education achieve its objectives ? Evidence from banks , government agencies and financial literacy educators in England. London. Lusardi, A., Mitchell, O. S., & Curto, V. 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Keywords: Islamic financial literacy; Islamic economics; university students

Topic: International Conference of Islamic Economic and Financial Inclusion

Link: https://ifory.id/abstract/GK8qeJhRtuvF

Conference: The 3rd International Conference on Sustainability and Innovation (ICoSI 2019)

Plain Format | Corresponding Author (Mohamad Fany Alfarisi)

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