Search results

There are some Muslims who only hold conventional bank accounts, regardless that some believe that such banks implement an interest charging system that contradicts Islamic law concerning the prohibition of charging interest. This study aims to investigate the consumers’ tendency to regret (CTR) related to purchasing conventional banking services (CTR-P) and the failure to purchase Islamic banking services (CTR-NP). Then, this study investigates whether CTR-P and CTR-NP translate into regret, which, in turn, leads to the intention to save money in Islamic banks.

A survey of Indonesian Muslims who only hold conventional banking accounts was conducted. There were 323 participants. This study then applied a partial least square structural equation modeling (PLS-SEM) to test the hypotheses.

This study found that a combination of CTR-P and CTR-NP translates into regret, which then drives the intention to save money in Islamic banks as a means of releasing such feelings of regret. The findings suggest that Muslims evaluate their banking decision on an Islamic basis and that making a decision that contradicts the prohibition of charging interest tends to cause regret. Islamic banks have opportunities to penetrate the market by focusing on Muslims who only hold accounts with conventional banks.

The findings of this study help advance understanding of Muslims’ negative emotional experience due to making a decision that they perceive contradicts Islamic law. Also, the findings help predict the strategy that Muslims use to neutralize such a negative emotional experience.

Islamic banking provides financial products and services to fulfill the transaction needs of Muslim consumers, and Muslim students are potential consumers who can support the development of Islamic financial institutions. This study aims to examine the factors that influence the intentions of Muslim students to save in Islamic banks. Independent variables in this study are a parental recommendation, location, profit sharing, religiosity, knowledge and financial information disclosure.

The samples in this study are Muslim university students in Indonesia and are divided into two groups as follows: the first group has an educational background in Islamic economics gained at Islamic universities, while the second group is studying at public universities and so do not have a background of this type. The study uses questionnaires to gather data and analyzes this data using a multiple linear regression model.

For the first group, this study finds that profit-sharing, religiosity, knowledge and financial information disclosure influence the intentions of Muslim students to save in Islamic banks. The results for the second group show that parental recommendation, profit sharing and religiosity influence the intentions of Muslim students without an Islamic economic background to save in Islamic banks.

The implications of this study are that the university environment can influence the intention of students to save in accounts at Islamic banks. As students form an important market segment for the banking industry as a new source of accounts and for future profitability, interested parties and in particular Islamic banks may wish to consider these results as part of their strategies for attracting customers.

The respondents of this study consist of Muslim students in Islamic and public universities in Indonesia. The different backgrounds of the students can describe intention levels in their assessments of Islamic banks.

The purpose of this study is to examine the impacts of product knowledge, perceived quality, perceived risk and perceived value on customers’ intention to invest in Islamic Banks. This study specifically examines an Islamic bank’s term deposits.

Structural equation modeling was used to analyze the data collected from 217 customers of an Islamic bank in Indonesia using an online survey.

This study highlights the central and dual roles of perceived risk as both the independent and the intervening variable that mediates the relationship between product knowledge and Muslim customer intention to invest in an Islamic bank’s term deposits.

This study only investigates term deposits as one type of investment in Islamic banks. This study contributes to the literature by examining the role of product knowledge, perceived quality, perceived risk and perceived value on Muslim customer intention to invest in Islamic term deposits.

The results of this study highlight the requirement for Islamic banks to educate customers to improve the depositors’ product knowledge because Muslim customers’ risk and value perception and intention are strongly influenced by product knowledge.

The investigation of perceived risk is particularly relevant for Islamic financial products because of the inherent nature of risk sharing in Islamic finance. This study investigates the role of product knowledge in influencing the Muslim customers’ perception of risk, quality, value and their intention to invest in Islamic bank term deposits. Ideally, the profit loss sharing concept (PLS) should be applied; however, in this context, revenue sharing is applied because of Indonesia’s central bank regulation.

This paper aims to examine the relationship between religiosity level and reasons for saving money in Islamic microfinance institutions [Baitul Maal wat Tamwil (BMT)] in Surakarta and Sukoharjo, Indonesia.

A chi-square test was used to identify the relationship between religiosity level and saving decisions in BMTs. In addition, the authors tested religiosity level and the reasons for transactions in both BMTs and conventional banking. Data were collected via a questionnaire. A total of 523 respondents from Surakarta and Sukoharjo, Indonesia, participated in the survey. The respondents are customers of 31 BMTs in Surakarta and Sukoharjo.

The authors find a significant relationship between one’s religiosity and the reason for saving money in BMTs. Products that are in accordance with Islamic principles form the highest reason for saving money in BMTs, followed by quality of service, recommendation from friends and location. In addition, purpose of business is the main reason for transactions in both BMTs and conventional banking. However, there is no significant relationship between religiosity level and the decision to transact in both BMTs and conventional banking.

There is a lack of literature discussing Islamic microfinance institutions, especially in Indonesia. Furthermore, BMT customers have different characteristics compared with those of large banks.

This paper aims to examine the relationship among trust, commitment and ego involvement and their impacts on word-of-mouth communication (WOM) for individual saving customers in Islamic banking.

The conceptual model and the hypotheses are formulated based on trust and commitment theory, organizational commitment theory, social judgment theory and the results of previous empirical studies on buyer–seller marketing relationship in business-to-customer (B2C) markets. Quantitative research methodology was performed to examine the model and the hypotheses. The data were collected using survey with questionnaire. The respondents of the survey are 100 Islamic banking individual saving customers. Multiple regression analysis was used to test the proposed model and the hypotheses.

The research results show that affective commitment has a positive and significant impact on WOM, while normative commitment and calculative commitment have no significant impact on WOM. Ego involvement has a positive and significant impact on trust, normative commitment, calculative commitment and affective commitment. However, trust does not have a significant impact on calculative commitment, normative commitment and affective commitment.

This research was only conducted in one Islamic bank in Indonesia. The data collection using the convenience sampling method as well as the use of a small sample size caused the limitation of the research results in representing across the retail customer of the bank. This study can be replicated with a larger sample size and by involving more Islamic banks to examine the stability of the findings.

The research results indicate that ego involvement has an important role in shaping trust and commitment of Islamic banking individual saving customers. Given this, the managements of Islamic banks need to ensure that the banks they have managed are relevant, important and appropriate with the values espoused by their individual customers.

This study is important because of the limited literature which discusses relationship marketing in the context of Islamic banking. Furthermore, this research has a novelty on the inclusion of ego involvement in explaining trust and commitment. The use of commitment as a multi-attribute construct also enriches the literature on buyer–seller marketing relationship in B2C markets due to the limited literature that addresses commitment as a multi-attribute construct.

The purpose of this study is to examine the impact of brand familiarity and profit-sharing rate on Muslim customers’ brand trust, perceived financial risk, perceived value and intention to invest in an Islamic bank.

A between-subjects experimental design was applied in the study. Six experiments involving two brand familiarity levels and three profit-sharing rates were conducted using a total of 217 samples. Randomization was applied in the study, which generated unequal sample sizes for each group of experiments.

The findings of this experimental study demonstrated that Muslim customers’ familiarity with the bank’s brand has a significant impact on their brand trust and intention to invest in an Islamic bank. The study also found that the profit-sharing rate has a significant impact on the perceived value both with and without interaction with brand familiarity.

The current study applies an independent measured design or a between-subjects experimental design, that resulted in unequal sample sizes. In addition, the study also does not control for the types of bank accounts owned by respondents. The design may invite the presence of confounding variables that exist due to individual differences and environmental variables.

The results show that Islamic bank managers should care about the brand familiarity issue, which strongly influences customers’ brand trust and customer intention to invest in an Islamic bank. In addition, Islamic bank managers should pay attention to the profit-sharing rate given to customers, as it interacts with brand familiarity in influencing customers’ perceived value.

This study examined the impact of brand familiarity and profit-sharing rate on Muslim consumers’ brand trust, perceived risk, perceived value and intention to save in an Islamic bank. The paper provides a shred of empirical evidence to the theoretical relationship between the subjective and objective cues that influence the formation of customers’ trust, perceived financial risk, perceived value and intention in the Islamic bank context.

This chapter explores the impact of the pandemic on Islamic commercial finance and Islamic social finance in a comprehensive manner. The chapter reveals that COVID-19 has provided more opportunities to Islamic social finance than Islamic commercial finance. The beauty of Islamic finance in this regard is reflected as the perception that Islamic finance does not achieve its objective as being a social finance is proved to be false as Islamic finance not only promotes profit maximization, but it has also the potential to achieve social objectives. Islamic commercial finance developments could be slower, but it is anticipated that Islamic social modes of financing will be used widely even by multilateral agencies to assist the communities who need help in this pandemic. The most important lesson one could learn from this pandemic in relation to Islamic finance is that Islamic finance is truly different from conventional finance and as such, it needs a unique legal, regulatory and governance framework to display the true potential of it.

This paper aims to use a theoretical model based on the theory of reasoned actions to investigate the effects of attitude, religious motivation, awareness and service and pricing on the intention to use Islamic banking among the Muslim minority in Spain. It also aims to determine the profile of a potential Islamic banking customer among this minority.

The research focuses on a survey of Muslims living in Barcelona, Spain, who know of the existence of Islamic finance but do not have access to it. The research uses factor analysis and logit regression to analyse the data.

The results show that attitude, religious motivation and awareness are important factors affecting the intention to use Islamic banking. The study also shows that the potential Islamic banking customer in Spain is a Muslim (Spanish, Moroccan or Pakistani), male, and did not reach university degree in his education.

The sample has 154 participants living in Barcelona, with the rest of Spain being ignored, although results should apply to all Muslims in Spain. Also, this study does not consider attitude as a moderator.

The research shows the potential for Islamic banks in the Spanish market and the possibility of raising awareness about Islamic banking.

Islamic banking in Spain could help the Muslim minority to participate effectively in financial activities, thus leveraging their capacity to integrate into the community. The study also highlights the importance of empowering the women in this minority and could help society by encouraging off-banking money to flow into the financial sector.

The research is the first empirical attempt to test the factors affecting the intention among Muslims in Spain to deal with Islamic banking. The study also highlights the importance of Islamic finance for Muslim minorities as a method to support their religious identity.

The purpose of this paper develops a conceptual model of social influence for Internet banking adoption (IBA) using social networking platforms (SNPs). It identifies the antecedents of social influence that can positively and negative influence the IBA among a targeted population of conventional and Islamic banks. Moreover, this paper contributes various factors to social influence theory with the purpose of enhancing its implication in the context of Internet banking uptake in developed and developing countries.

This study uses a social constructivism approach to understand customer experiences, thoughts, knowledge, awareness and perceptions in relation to IBA. For this study, data were collected from 30 respondents using semi-structured interviews and purposive sampling.

Social influence comprises customer recommendations, suggestions, ratings, reviews, experiences and thoughts regarding the IBA of Islamic and conventional banks. The findings reveal that social reviews, social experts, social consensus, social responsibility and social perceptions are the key antecedents of social influence that can enhance IBA of SNPs. The research finds that positive social reviews, expert support, consensus, social responsibility and social perceptions are significant in relation to conventional Internet banking. The respondents revealed serious concerns about the privacy of their personal and financial information especially in relation to Islamic banks.

The effective and well-organized use of SNPs can foster service reviews, word of mouth, higher levels of service awareness, interactive communication, social consensus and social trust to drive the adoption of Internet banking. This study proposes the conceptual model which has positive business implications and provides the banks direction to use the SNPs to their advantage to influxes their customers to adopt the use of Internet banking.

Most previous studies have used technology acceptance model, theory of planned behavior and unified theory of acceptance and the use of technology theories in the adoption of technology and IBA. These theories have not fully illuminated the role of social content as a way to enhance or decrease the number of customers in conventional and Islamic banks. This study develops social influence theory by exploring several dimensions (i.e. social reviews, awareness, consensus, cooperation and experts support) in the context of IBA for users of SNPs. Social influence can create more reviews and can lead to more prepurchase information. It can drive customer inquiries and engagement and can inform purchase decisions for IBA. On the other hand, it can motivate existing customers of Islamic banks to use conventional banking services due to effective word of mouth.

This study aims to examine idle funds in mosques in Mataram City and analyze the intentions of the mosque chairman to place mosque funds in Sharia banks. Six variables are used to analyze the intention; attitudes, subjective norms, behavioral control, sharia financial literacy, sharia banking knowledge and the responsibility of the management for the trust of the society.

This research consists of two studies; descriptive research examining idle funds of mosques and correlational research analyzing the intentions of mosque directors to place mosque funds in Sharia banks. Intentions will be analyzed using the theory of planned behavior approach, developed through the PLS-SEM method, and the data obtained from questionnaires through surveys were processed using the SmartPLS 3 application.

This study found that the average surplus between income and expenditure reaches IDR2.7m monthly. Also, 75% of mosques have placed their funds in Islamic banks. This study shows a positive relationship between the level of Islamic financial literacy, knowledge of Islamic banking, responsibility for public trust, attitudes toward Islamic banking, subjective norms and behavioral control in influencing the intentions to place mosque funds in Islamic banks. However, only behavioral control is accepted as it significantly influences intentions. Behavioral control means that to maximize intentions, Islamic banks need to make it easier for mosque administrators to place funds.

This research signifies a pioneering effort in examining idle funds within mosques, particularly those equipped with comprehensive financial reports within Mataram City. Furthermore, it spearheads an inquiry into the intentions of mosques to channel their funds into Sharia banks, underpinned by rigorous quantitative methodologies.