Technology Adoption in Islamic Finance: Epistemological Dissonance from Keynesian Protocols and the Architecture of Instrument-Based Innovation Models (Full Report)

Abstract

This comprehensive report explores the intersection of Islamic finance, Keynesian economic theory, and modern financial technology. Key insights include: Epistemological Dissonance: Islamic finance has historically faced structural friction by operating within Keynesian paradigms reliant on fiat money, debt instruments, and interest-rate adjustments, which conflict with prohibitions against riba (interest) and gharar (uncertainty). Behavioral Adoption Models: Extending traditional acceptance models highlights the critical role of Perceived Sharia Compliance (PSC), demonstrating that doctrinal purity and ethical alignment often supersede mere technological convenience for Islamic economic agents. Smart Sukuk Innovation: Blockchain technology and smart contracts disintermediate traditional capital markets, reducing issuance costs and settlement times while enabling fractionalized, asset-backed investment through instruments like the Blossom Finance Smart Sukuk. Digital Microfinance & MFS: Platforms such as Nagad Islamic and digital adaptations of the Rural Development Scheme (RDS) leverage mobile financial services with strict fund segregation and profit-renunciation mechanisms to scale faith-based financial inclusion. Macroeconomic Decoupling: The integration of asset-backed tokenization and equity-based financing creates a financial ecosystem closely tied to the real economy, offering a potential solution to the Keynesian liquidity trap. KSCCN paper (KSCCN-PAP-TECH-ADOPT-ISF-2026-10), Series on Critical AI, Digital Sovereignty and Economic Diplomacy, 11 October 2026. Dr. Syed Muntasir Mamun, ORCID 0000-0001-6845-2853. The views expressed are those of the author.