Village-Owned Enterprises and Community Welfare through the Falah Framework: Evidence from BUMDes Mekar Sembodo

Background: Village-Owned Enterprises (BUMDes) serve as instruments for village economic development, aiming to enhance community self-reliance and welfare. However, the success of a BUMDes is measured not only by economic profit but also by social benefits and overall community well-being. Objective: This study aims to evaluate the role of BUMDes Mekar Sembodo in improving community welfare and to analyze its alignment with Islamic economic values ​​based on the concept of falah (success/well-being). Methods: A qualitative method employing an evaluative case study approach was used to examine the role of BUMDes Mekar Sembodo. Data were collected in a natural setting through observation, interviews, and documentation and were subsequently analyzed qualitatively. Results: BUMDes Mekar Sembodo contributes to community welfare through inclusive access to capital, employment creation, human resource development, agricultural support, and social redistribution. It provides employment for 78–88 villagers, contributed more than IDR 45 million to Village-Owned Revenue (PADes) in 2024, conducted capacity-building activities at least four times annually, supported an approximately 15% increase in organic rice production, and allocated about 2.5% of net profits through the Dana Keberkahan. Its practices also reflect amanah, transparency, maslahah mursalah, ukhuwah, and ta’awun. Conclusion: The findings indicate contributions across the falah dimensions of baqa’, hurriyah, ‘izzah wa al-karamah, and ‘ilm wa al-hikmah. However, formal Sharia institutional strengthening remains necessary to support legal certainty and the sustainability of these practices.