Islamic Cooperative Financing as a Driver of Traditional Market Traders’ Income: Evidence from Beringharjo Market, Yogyakarta

Abstract

Islamic cooperative financing plays an important role in supporting financial inclusion and the sustainability of micro-enterprises, particularly traditional market traders with limited access to formal financing. This study examines the effect of Islamic cooperative financing on the income of traditional market traders in Beringharjo Market, Yogyakarta. A quantitative approach was employed using simple linear regression analysis with SPSS. The results show that Islamic cooperative financing has a positive and significant effect on traders’ income, with a regression coefficient of 0.853 and a significance value of 0.000. Thus, the research hypothesis is supported. The coefficient of determination shows an R Square value of 0.785, indicating that Islamic cooperative financing explains 78.5% of the variation in traders’ income, while the remaining 21.5% is explained by other factors outside the research model. These findings demonstrate that Islamic cooperative financing can serve as an important instrument for strengthening traders’ productive capacity and income. The study contributes empirical evidence to the literature on Islamic microfinance and provides practical implications for Islamic cooperatives and policymakers to expand productive financing while strengthening financial literacy and business assistance for traditional market traders.