Islamic Banking Innovation: Addressing Fintech Challenges Through Blue Ocean Strategy

Ramadhani Irma Tripalupi; Iwan Setiawan; Muhammad Zaky; Kadar Nurjaman; Reza Fauzi Nazar

doi:10.14421/jbmib.2026.0502-03

Authors

Ramadhani Irma Tripalupi Sunan Gunung Djati State Islamic University, Bandung,
Iwan Setiawan Sunan Gunung Djati State Islamic University, Bandung,
Muhammad Zaky Sunan Gunung Djati State Islamic University, Bandung,
Kadar Nurjaman Sunan Gunung Djati State Islamic University, Bandung,
Reza Fauzi Nazar Sunan Gunung Djati State Islamic University, Bandung,

DOI:

https://doi.org/10.14421/jbmib.2026.0502-03

Keywords:

Islamic Banking Innovation; Blue Ocean Strategy; Fintech Challenges; SWOT Analysis

Abstract

Purpose— This study examines Islamic banking innovations to address fintech challenges through a blue ocean strategy. Therefore, the main focus of the discussion is on: External business environment factors of Islamic banking; Internal business environment factors; SWOT analysis; and Blue Ocean Strategy.

Design/methodology/approach— This descriptive qualitative research used primary data collected through interviews and secondary data. Five Islamic commercial banks were selected through purposive sampling. Data were collected, reduced, and then triangulated using literature and documentation studies to strengthen arguments and analysis, leading to strategic and innovative recommendations.

Findings— The strategy of Islamic banks in responding to fintech challenges focuses on holistic digital transformation to achieve operational efficiency, increased security, Sharia compliance, and the creation of a holistic digital service ecosystem, such as: integrating various financial services, ZISWAF platforms and disaster mitigation, cardless withdrawals, investment services, legacy management, and halal supply chain financing in one holistic ecosystem supported by partnerships with industry and government.

Research implication/limitation— This study develops an integrated digital ecosystem model for Islamic banking based on Blue Ocean Strategy, emphasizing value innovation amidst fintech disruption. Unlike previous studies that focused on digitalization and operational efficiency, this study offers a strategic framework that integrates sharia principles, digital transformation, and differentiation strategies to create new competitive advantages. Thus this study expands the literature on Islamic banking digital transformation through a Blue Ocean Strategy perspective and provides a conceptual framework for strengthening competitiveness in the fintech era.

Originality/value— A weakness of this study is its limited representation of the broader and rapidly evolving dynamics of the Islamic finance and fintech markets, due to the limited data used and the specific sample size. However this study provides useful initial insights, and therefore requires multiple approaches to build a more robust and comprehensive body of knowledge that provides a complete or definitive picture of the complex and ever-changing Islamic finance and fintech landscape.

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