Relationship between Islamic bank consumptive financing and gross regional domestic product in Indonesia, 2016-2020

IntroductionPrevious literature discussed financing's impact on performance without separating the financing model.ObjectivesThis study uses consumptive data of Islamic commercial banks, inflation rate, and population as independent variables, GRDP 33 provinces in Indonesia dependent variable. MethodThe used Malaysia banks for its pioneering efforts establishing banking Southeast Asia. The collects from five Indonesian four Malaysian with an observation period 2011–2020. analysis this was Generalized Method Moment (GMM).ResultsThe results explain that has a negative insignificant effect Indonesia, rate positive significant Indonesia. Consumptive credit conventional account more than 45% total financing. ImplicationsThe Financial Services Authority should adopt policies to maintain growth Bank productive financing, is, working capital investment because bank IndonesiaOriginality/NoveltyThis unique feature compared previous studies use at variables analyze contribution local economy gross regional domestic product.