This study aims to examine Islamic FinTech transformation as a governance process, not only as a source of technical efficiency. Although previous research emphasizes growth, it gives less attention to how artificial intelligence and big data affect the field’s ethical and institutional foundations. The study therefore considers how these technologies influence Sharīʿah compliance, ethical governance and institutional legitimacy.
The study adopts a critical narrative review of peer-reviewed publications and selected scholarly and institutional sources. The main search assessed 120 distinct candidate records and included 87 in the analytical synthesis. A separate complementary update and re-evaluation assessed 68 records, used 20 and excluded 48. Hybrid inductive–deductive coding produced seven constructs and four cross-cutting analytical dimensions; the relationships proposed are empirically testable theoretical propositions, not causal findings.
Algorithmic transparency, ethical principles, digital Sharīʿah auditing and data privacy are central to institutional trust, continued Sharīʿah compliance and legitimacy. The framework organizes seven constructs across five relational stages, with algorithmic transparency as a possible mediator between technological inputs and institutional trust. Trust functions as the legitimacy mechanism, sustainability as the final outcome, and a feedback loop connects institutional learning and regulatory alignment.
Unlike reviews that mainly catalogue applications, adoption drivers or performance effects, this study explains how technological inputs may acquire legitimacy through ethical governance, Sharīʿah compliance and algorithmic transparency. The resulting framework connects institutional trust with sustainability and translates unresolved relationships into a testable research agenda.
