KNEKS: Sharia Services Should Not Rely Solely on Halal Labels

The sharia financial industry is still facing major challenges in attracting public interest, particularly among young people. A halal label alone is deemed insufficient if the services provided are less practical than those from conventional banking.

Director of Sharia Ecosystem Infrastructure at KNEKS, Sutan Emir Hidayat, stated that sharia financial institutions must strengthen service quality to compete amid shifting societal lifestyles that are increasingly digital.

“All parties involved with sharia financial institutions should not rely solely on religious factors,” said Sutan Emir during the Focus Group Discussion (FGD) Road to ISF 2026 titled “Beyond Awareness: From Lifestyle to Inclusion,” organised by Republika together with FoSSEI on Wednesday (13/5/2026).

According to him, people now prefer services that are fast, easy, and comfortable to use. Therefore, the sharia industry must be able to provide services that are on par, or even better, than conventional services.

He gave the example of conventional banks that have reached remote areas through agents and digital services. This situation makes people more familiar with conventional services in their daily activities.

“The best, fastest, and most comfortable services,” he stated.

Criticism of sharia services also came from discussion participants. A student from UIN Sunan Kalijaga, Muhammad Rido, assessed that the current young generation pays great attention to transaction ease and app usage experience.

“Perhaps one reason why Gen Z does not use sharia finance is the flexibility, speed, and experience in sharia finance,” Rido revealed.

He said that campus payments, digital services, and daily student transactions are still more connected to conventional banks.