Vol. 1 No. 1 (2026): Meuseuraya: Islamic Economic Journal (January-June 2026)

Purpose – This study aims to analyze the level of Islamic financial literacy among the people of Lhokseumawe City and its influence on the use of Islamic investment products.

Design/methodology/approach – This study employs a quantitative method with a logistic regression approach. Data were collected from 400 residents of Lhokseumawe City across four sub-districts—Blang Mangat, Muara Dua, Muara Satu, and Banda Sakti—determined using the Slovin formula.

Findings – The results indicate that: (1) the level of Islamic financial literacy among the community is categorized as moderate, with variations in knowledge, attitudes, and behavior related to Islamic finance; (2) Islamic financial literacy has a significant effect on the use of Islamic investment products in Lhokseumawe City.

Research limitations/implications – This study is limited to respondents within Lhokseumawe City and focuses on quantitative analysis. Future research is recommended to expand the geographical scope and incorporate qualitative approaches to gain deeper insights into behavioral aspects of Islamic financial literacy.

Practical implications – The findings highlight the need to enhance education and socialization programs related to Islamic finance in order to promote broader financial inclusion and encourage greater use of Islamic investment products.

Originality/value – This study contributes to the literature by providing empirical evidence on the role of Islamic financial literacy in influencing investment behavior at the local level, particularly in Lhokseumawe City, offering insights for policymakers and financial institutions in developing targeted literacy programs.