SOCIAL SECURITIES SCHEME, FINANCIAL INCLUSION, AND ITS IMPACT ON POVERTY ALLEVIATION IN INDONESIA: CASE OF ZAKAT RECIPIENT

This study examines the impact of social security’s programs, and financial inclusion on poverty alleviation and household consumption in Indonesia. The samples of this study is 2835 zakat recipient in 25 of 34 provinces in Indonesia. Using panel regression analysis, the research explores key variables, including the Family Welfare Deposit (Kartu Keluarga Sejahtera, KKS), Family Hope Program (Program Keluarga Harapan, PKH), Non-Cash Food Assistance (Bantuan Pangan Non-Tunai, BPNT), Social Health Insurance (ASKES), and financial inclusion indicators such as bank account ownership, mobile phone usage, and digital payment adoption. The findings reveal that PKH and BPNT significantly reduce poverty, and promoting total household consumption. It revealed their effectiveness in addressing immediate needs and improving welfare. Financial inclusion variables, particularly mobile phone usage and digital payments, also show positive effects on consumption but mixed results on poverty measures, suggesting the need for broader accessibility and digital literacy. Comparisons with prior studies underscore the consistency of social protection programs as tools for poverty eradication, while emphasizing the complementary role of financial inclusion in fostering long-term economic resilience. The study recommends enhancing digital financial services, expanding the coverage of social protection programs, and especially integrating with Kampung Zakat program as sustainable strategies to strengthen their impact on poverty alleviation and economic development.