Transformation of Islamic Monetary Policy in the Digital Era: A Systematic Literature Analysis on Monetary Transmission Mechanisms, Macroeconomic Stability, and Islamic Financial Innovation in OIC Countries

Muslim Marpaung; Irma Suryani Lubis

doi:10.55927/ijsmr.v4i6.82

Authors

Muslim Marpaung Politeknik Negeri Medan
Irma Suryani Lubis Politeknik Negeri Medan

DOI:

https://doi.org/10.55927/ijsmr.v4i6.82

Keywords:

Islamic Monetary, Monetary Transmission, Digital Islamic Finance

Abstract

This study aims to analyze the development of literature related to the transmission mechanism of Islamic monetary policy, macroeconomic stability, and Islamic financial innovation in Organization of Islamic Cooperation countries. The method used is a Systematic Literature Review with the PRISMA approach to identify, filter, and synthesize relevant, reputable scientific articles. The results of the study indicate that the transmission mechanism of Islamic monetary policy has shifted from traditional asset-based channels to hybrid transmission channels influenced by the digitalization of the financial system. Macroeconomic stability in OIC countries still faces structural challenges such as financial system heterogeneity, dependence on the commodity sector, and limited liquid Islamic monetary instruments. Meanwhile, Islamic financial innovation has proven to have significant potential in increasing the efficiency of monetary policy transmission, financial inclusion, and financial system transparency.

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