Abstract

In conducting its business, Islamic banking is based on a core product for the results of financing developed in musharaka and mudharabah financing products. This is what differentiates it from the conventional banking system based on interest. Economic sector in Indonesia is largely supported by micro, small and medium enterprises (SMEs) are proven to have the advantage of being able to survive during the economic crisis. So that this sector is very potential to be further developed through an appropriate policy and support from the appropriate institution anyway. Based on the principle of profit sharing financing system, Islamic banking is expected to help the development of SMEs optimally. This is because financing with profit and loss sharing system can touch more productive sectors by providing working capital required by the business unit. This paper tries to discuss about the contribution profit sharing financing extended by the Islamic banking to meet the needs and support the development unit of micro, small and medium enterprises (SMEs) in Indonesia. The data used in this paper comes from the publication of Bank Indonesia, the Islamic Banking Statistics June 2015 as well as other relevant sources. The methodology used in this paper is descriptive and qualitative literature review. The findings of this paper states that the financing provided by the Indonesian Islamic banking during the period from 2009 until June 2015 to the SMEs sector continues to increase each year, although there are limitations faced. Therefore, it can be said that the contribution of the financing system for the results of the development of SMEs in Indonesia is still needed for the micro, small and medium enterprises (SMEs) play an important role in employment, gross domestic product (GDP), the flexibility and toughness in the face of economic crisis, so as to encourage the growth of the real sector.