Adapting Indonesian Islamic Financial Governance to Nigeria: A South-South Policy Diffusion Analysis

Abstract

Purpose – The study aims to explore how institutional practices from Indonesia’s Islamic economic system can inform governance reforms and inclusive development strategies in Nigeria. Specifically, the paper analyzes regulatory frameworks, financial instruments such as sukuk, and community-based welfare mechanisms to determine their adaptability within Nigeria’s economic and political structures.

Methodology – A qualitative research design was adopted using document analysis and thematic analysis of policy reports, academic literature, and institutional frameworks relating to Islamic finance governance in Indonesia and Nigeria.

Findings – Findings indicate that Indonesia’s integrated regulatory architecture, sukuk-based infrastructure financing, and zakat-linked social welfare mechanisms have strengthened financial inclusion, institutional transparency, and development outcomes. In contrast, Nigeria’s Islamic finance sector remains emerging, with regulatory fragmentation and limited institutional coordination constraining its developmental potential.

Implication – The study concludes that selective policy transfer, particularly regulatory integration, transparency standards, and social finance mechanisms, could enhance governance accountability, infrastructure financing, and inclusive growth in Nigeria’s political economy.