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The purpose of this paper is to determine the explanatory factors for the selection of Islamic banks and evaluate the moderating role of demographic characteristics. This study seeks to better understand these determinants in Tunisia, a country with a developing Islamic finance system and a culture different from those in other Muslim countries studied in the literature.

The authors developed a two-sided approach: a quantitative survey and 12 semi-structured interviews based on four customer segments identified by the quantitative study. For the survey, data were collected from 180 Islamic bank clients in Tunisia. The factors adopted for the selection of an Islamic bank are service quality, trust, and compliance with Sharia (Islamic) law. The authors identified and measured the selection criteria using a factor analysis, regression analysis, and demographic characteristics analysis.

Customers consider several factors while choosing an Islamic bank: the quality of service offered by the financial institutions, trust, and (especially) compliance with Sharia law. Moreover, gender and age appear to be the only moderators between the selection of an Islamic bank and these determinants.

This study offers Islamic banks a better understanding of how Tunisian customers select financial institutions. These banks must consider the different determinants of choice in order to create value for consumers and prepare their marketing strategies. The authors identify four customer segments based on gender and age by which the banks may improve their positioning and market share, thus contributing to the development of Islamic financial institutions in Tunisia.

This is the first study of its kind in Tunisia, where the market share of Islamic finance remains low. The study enriches the Islamic marketing literature on the quality of Islamic financial institutions’ service, trust, and compliance with Sharia law. It also tests demographic characteristics as moderators. The results and implications of this research can be applied to countries similar to Tunisia.