Islamic Finance in Indonesia: Opportunities and Challenges in Facing the Society 5.0 Era

This study aims to analyze and understand the extent of opportunities and challenges of the halal industry, especially in the sharia financial sector in Indonesia in the Society 5.0 era. This research uses a qualitative design with an economic and sharia concept approach and literature study. The results show that the sharia finance industry in Indonesia has its own opportunities and challenges. Indonesia has the potential to become a major player in the global sharia financial industry. First, Indonesia has the world’s largest Muslim population. Second, Islamic finance is implemented as an alternative financial system to achieve stability, equality, and growth. Third, total sharia financial assets in Indonesia continue to experience positive trend growth. Fourth, generation Z and millennials are the ones who use technology the most. Fifth, Indonesia has a large potential for cash waqf and zakat. Meanwhile, there are challenges facing the Islamic finance industry in Indonesia. First, the sharia financial literacy and inclusion index is still low. Second, there are many competing countries in the halal industrial sector, especially in the sharia financial sector. Third, human resources are still low in the sharia financial industry.