Faith-Driven Circular Economy: Islamic Social Entrepreneurship and Community Empowerment through Waste Bank Innovation in Surabaya, Indonesia

Abstract

Urban waste has become one of Indonesia’s most pressing sustainability challenges, with Surabaya generating more than 1,500 tons of household waste daily and only a small fraction processed through formal waste systems. This study explores how the Bank Sampah Rukun Jaya, located in Jambangan, Surabaya, integrates Islamic social entrepreneurship (ISE) principles within a circular economy (CE) framework to address environmental, social, and economic issues simultaneously. Employing a qualitative ethnographic approach, data were collected through observation, interviews, and document analysis between June and September 2019. The findings reveal four interrelated outcomes: (1) improved community waste governance through faith-based participation; (2) multidimensional empowerment—economic, social, and environmental—anchored in Islamic ethics of amanah (trust) and maslahah (public benefit); (3) the development of a community-level circular micro-economy, generating IDR 18–22 million monthly from recyclable materials; and (4) institutional sustainability grounded in transparency, gender inclusion, and social trust. The study advances the concept of a Faith-Driven Circular Economy (FDCE) that synthesizes moral motivation, economic incentives, and ecological stewardship into a coherent model for sustainable urban transformation. It argues that Islamic values can enhance collective responsibility, turning waste management from a civic obligation into an act of worship and social justice. This research contributes to the growing discourse on faith-based sustainability, demonstrating how ethical entrepreneurship can foster inclusive innovation in the Global South.