Mudharabah financing in Islamic banking plays a crucial role in addressing real-sector capital problems through its profit and loss sharing (PLS) system. However, despite its potential, the PLS system faces several obstacles that make it less attractive to financial institutions. This study aims to identify the issues causing non-optimal mudharabah financing practices in Indonesian Islamic banking, analyze solutions, and provide the optimization strategies. This study employed a qualitative method with the Analytical Network Process (ANP) approach to analyze the priority issues and solutions to mudharabah financing practices in Indonesia. The data were collected through interviews and focus group discussions with industry experts and stakeholders. The findings show that the primary issues are: 1) internal problems such as non-collateral for long-term profit sharing for small financing customers, and 2) external problems including regulatory issues regarding the COVID-19 stimulus. The study identified priority solutions to overcome these issues, including long-term financing with profit-sharing ratios and yield benchmarks, regulatory strategies, community training, and IT and HR investments. Developing the integrated MSME segment and strengthening stakeholder synergy were also identified as crucial. The study recommends that Islamic banks in Indonesia implement the identified priority solutions to increase trust in mudharabah financing and thus become the core product for financing real-sector capital problems in Indonesia. These findings have important implications for the regulatory authorities and policy-makers to facilitate a conducive environment for Islamic banking and to address the challenges faced by Islamic financial institutions.