Integration of Islamic Microfinance, Religious Values, and Children’s Education Investment in Breaking Intergenerational Poverty

Abstract

This study aims to examine how Islamic microfinance contributes to household economic stability, encourages investment in children’s education, and supports intergenerational economic mobility. The study addresses the persistent issue of intergenerational poverty among low-income families who are constrained by short-term consumption needs and limited access to productive financial resources. This research employs a qualitative approach with a case study design conducted in Mandau District, Bengkalis Regency. Data were collected through in-depth interviews, observations, and documentation involving 15 beneficiary families of BMT Bina Swadaya and institutional managers. Data were analyzed using grounded theory techniques, including open coding, axial coding, and selective coding. The results indicate that Islamic microfinance financing is primarily utilized for productive economic activities, leading to increased business turnover and improved household income stability. This stability allows families to shift expenditure priorities toward children’s education, including school fees and learning materials. Religious values play a significant role in shaping responsible financial behavior, encouraging disciplined repayment, and ensuring productive fund utilization. This study is limited to qualitative analysis and does not quantitatively measure long-term intergenerational mobility. The findings provide implications for strengthening Islamic microfinance as a tool for sustainable poverty alleviation. This study offers a novel integrative framework linking Islamic microfinance, household economic stability, religious values, and educational investment in the context of intergenerational mobility.