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Article
Publication date: 26 December 2022

Nurul Shahnaz Mahdzan, Mohamad Fazli Sabri, Abdul Rahim Husniyah, Amirah Shazana Magli and Nazreen Tabassum Chowdhury

The first objective of this study is to analyze whether financial behavior (FB), financial stress (FS), financial literacy (FINLIT) and the locus of control (LOC) influence…

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Abstract

Purpose

The first objective of this study is to analyze whether financial behavior (FB), financial stress (FS), financial literacy (FINLIT) and the locus of control (LOC) influence subjective financial well-being (SFWB) among low-income households in Malaysia. The second objective is to investigate whether the use of digital financial services (DFS) moderates the influence of FB and FS, on SFWB.

Design/methodology/approach

Motivated by the literature on transformative service research (TRS), this study examines how the use of DFS impact SFWB among low-income households in Malaysia. Low-income households are chosen as they are more likely to be financially excluded and lack financial knowledge and skills. Using an interviewer-administered survey, trained enumerators collected data from 1,948 low-income households in Malaysia, selected using a two-stage sampling based on the National Household Sampling Frame obtained from the Department of Statistics Malaysia.

Findings

Results reveal that SFWB is positively influenced by FB and the LOC, and is negatively impacted by FS and FINLIT. The evidence shows that the use of DFS counterintuitively weakened the strength of the relationship between FB and SFWB, but effectively reduced the adverse effect of FS on SFWB.

Practical implications

To reverse the signs of relationship, financial services marketers need to identify the specific types of DFS that low-income households use in order to provide targeted marketing efforts and financial education to promote the use of DFS on a more holistic basis to increase financial well-being.

Originality/value

The findings of this study add to the body of knowledge deliberating on the opposing effects of technology on consumers' welfare and well-being. This study focuses on the lower-income stratum of Malaysian households as this group of the population is more likely to be financially excluded and have deficiencies in financial knowledge and skills. Findings of this study show that DFS use can actually diminish the positive impact of FB on SFWB while reducing the adverse effect of FS on SFWB.

Details

International Journal of Bank Marketing, vol. 41 no. 2
Type: Research Article
ISSN: 0265-2323

Keywords

Article
Publication date: 26 April 2022

Nurul Shahnaz Mahdzan, Rozaimah Zainudin and Mohd Sayuti Shaari

This study investigates the borrowing behaviour of public sector employees in Malaysia by focusing on religious belief and psychological factors. The first objective of the study…

Abstract

Purpose

This study investigates the borrowing behaviour of public sector employees in Malaysia by focusing on religious belief and psychological factors. The first objective of the study is to examine the differences in the borrowing behaviour according to demographic and socioeconomic factors of the civil servants. The second objective of the study is to investigate the influence of religious belief, excessive consumption, materialism and financial literacy towards two aspects of borrowing behaviour: personal loans and credit card usage.

Design/methodology/approach

Primary data was collected using a digital survey which was distributed using a convenience sampling approach to public sector employees working in Putrajaya and Kuala Lumpur, Malaysia. A sample of 340 public sector employees was obtained for analysis.

Findings

The study found that civil servants of different education backgrounds and income levels tend to differ in their borrowing behaviour. Specifically, those with lower levels of education, or lower income levels, tend to have a higher tendency of borrowing through personal loans. Multiple regression analyses reveal that public sector employees with either higher religious belief or higher financial literacy have a lower tendency of borrowing either through credit cards or personal loans. However, those who spend excessively or those who have higher levels of materialism tend to display more aggressive borrowing behaviour in terms of credit card usage and personal loans.

Originality/value

The study contributes to the literature by exploring the role of religious belief on borrowing behaviour. In addition, the study contributes to the literature by examining a specific group in the Malaysian society, i.e. public sector employees, due to the perturbing state of indebtedness among civil servants in Malaysia.

Details

Asia-Pacific Journal of Business Administration, vol. 15 no. 3
Type: Research Article
ISSN: 1757-4323

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Article
Publication date: 2 January 2024

Nazreen Tabassum Chowdhury, Nurul Shahnaz Mahdzan and Mahfuzur Rahman

This study aims to explore the underlying issues of behavioural biases in relation to stock market participation and the challenges of individual investors in Bangladesh. The…

Abstract

Purpose

This study aims to explore the underlying issues of behavioural biases in relation to stock market participation and the challenges of individual investors in Bangladesh. The study identifies behavioural biases affecting individuals’ stock market participation, their circumvention strategies and the importance of financial knowledge in encouraging the participation of individuals in the stock market.

Design/methodology/approach

Semi-structured interviews were used in this study to gather information from industry researchers, individual investors, brokers and institutional advisors. Twenty-two experts were contacted, and 13 agreed to participate in the interviews. The study then uses the thematic analysis method to report its findings.

Findings

This research shows that investors’ behavioural biases (such as loss aversion, herding, trust, gambler’s fallacy and risk tolerance) are among Bangladesh’s primary drivers of stock market participation. Circumvention strategies (such as poor corporate governance and agency costs) also play a part in individuals’ participation. These influences are in addition to the obvious factors of investment risks, poor infrastructure, poor regulation enforcement and the need for more sufficient investment products.

Research limitations/implications

This study conducted 13 interviews with expert subjects, which is a small sample size. However, the findings achieved saturation and cannot be ignored. Future research should use quantitative or experimental methods with a large sample size to validate the current findings.

Originality/value

This study is pioneering in the Bangladesh stock market, exploring the behavioural biases of investors’ participation in the market. This paper provides valuable insights into investor participation by discovering the underlying behavioural biases that have been continually ignored; these insights may also be relevant in frontier markets in Asian countries.

Details

Qualitative Research in Financial Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1755-4179

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Article
Publication date: 10 December 2018

Rozaimah Zainudin, Nurul Shahnaz Ahmad Mahdzan and Ee Shan Leong

This study is an exploratory study investigating firm-specific internal factors that influence the profitability performance of selected life insurance firms in eight Asian…

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Abstract

Purpose

This study is an exploratory study investigating firm-specific internal factors that influence the profitability performance of selected life insurance firms in eight Asian countries (China, Hong Kong, Taiwan, Singapore, Japan, South Korea, Thailand and Malaysia) from 2008-2014. This paper aims to focus on internal rather than external factors based on the resource-based view suggesting that the internal resources of a firm are key to gaining competitive advantage.

Design/methodology/approach

The authors used panel data estimation model to test our six hypotheses on these eight selected countries for the period between 2008 and 2014.

Findings

A random effect model reveals that size, volume of capital and underwriting risk are significantly related to the profitability of Asian life insurance firm, measured as return on assets. Premium growth, asset tangibility and liquidity are insignificant predictors of the profitability performance of these life insurance firms.

Practical implications

Three implications of this study are that life insurance firms need to proactively tap new business opportunities by attracting younger generation customers via e-marketing technologies; secure larger capital base to finance their market expansion strategies; and focus on intangible resources such as goodwill, brand equity and reputation.

Originality/value

This study contributes to the literature by conducting an exploratory regional-based panel study of Asian life insurance firms to find common factors that contribute towards profitability. The study is conducted on a collective sample of Asian life insurance firms based on the premise that the firms included in the sample engage in cross-border activities and share the same international financial reporting standards. These commonalities allow us to treat the firms jointly in a somewhat similar Asian macroeconomic environment.

Details

Journal of Asia Business Studies, vol. 12 no. 4
Type: Research Article
ISSN: 1558-7894

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Article
Publication date: 24 November 2023

Ida Lopez, Nurul Shahnaz Mahdzan and Mahfuzur Rahman

Using the integrated behavioural model (IBM) as a theoretical framework, this study aims to identify the determinants of saving behaviour among Malaysia's income-earning…

Abstract

Purpose

Using the integrated behavioural model (IBM) as a theoretical framework, this study aims to identify the determinants of saving behaviour among Malaysia's income-earning Generation Y (Gen Y) born in the years 1980–1995.

Design/methodology/approach

The study was conducted using a questionnaire survey targeting Gen Y respondents 500 sets of responses were obtained via convenience sampling method.

Findings

Analysis conducted using partial least squares structural equation modelling (PLS-SEM) revealed that there were positive relationships among instrumental attitude, injunctive norm, perceived control, self-efficacy and intention to save. Secondly, intention to save, financial literacy and time preference were found to positively influence saving behaviour.

Practical implications

Policymakers may find this study useful as the results reveal saving behaviour determinants of Gen Ys in Malaysia, and policies could then be formulated to improve Gen Y's saving behaviour.

Originality/value

This study contributes to the literature by applying the IBM to a study on saving behaviour.

Peer review

The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-05-2023-0340

Details

International Journal of Social Economics, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 31 May 2022

Ida Lopez, Nurul Shahnaz Mahdzan and Mahfuzur Rahman

Using the integrated behavioural model as a theoretical framework, this study aims to identify salient beliefs underlying intention to save regularly among Gen Ys in Malaysia.

Abstract

Purpose

Using the integrated behavioural model as a theoretical framework, this study aims to identify salient beliefs underlying intention to save regularly among Gen Ys in Malaysia.

Design/methodology/approach

Semi-structured interviews were conducted with 13 participants who were selected using purposive and snowball sampling methods.

Findings

While Gen Ys are not pushed by others to save, they find that older people (parents, parents-in-law, colleagues and relatives) influence them to save. The main facilitator of regular saving behaviour is low financial commitments. Expenses, particularly unexpected expenses, was found to be the main factor impeding the performance of regular saving. Overall, the participants feel that, irrespective of what happens in the future, they want to continue saving regularly. Lastly, self-efficacy might be present for some participants, but not self-control. Some end up withdrawing their savings for spending, emergency, and travel, thus ending up almost depleting their savings.

Research limitations/implications

Of this study’s 13 interviewees, only one has not managed to save any money. Such an imbalanced sample composition was not deliberate. It appears those who have not saved money were reluctant to be interviewed, as this topic might be uncomfortable for them. This could have led to only those who save being eager to be interviewed.

Practical implications

Policy makers should find this study useful, as the behaviour of Gen Ys in Malaysia is different from the overall perception of Malaysians’ financial behaviours. Gen Ys have positive attitudes towards saving money, although they do not seem to practice long-term saving. Policymakers could identify, with banks and the Employee Provident Fund, ways to encourage Gen Ys to think long term. Government could play its part by creating and increasing awareness amongst Gen Ys on the long-term consequences of inadequate savings.

Originality/value

This study contributes to the literature by identifying the salient beliefs underlying regular saving behaviour through the conduct of elicitation interviews. It is an empirically grounded study enhancing the understanding of intention to perform regular saving among Gen Ys in an emerging market.

Details

Qualitative Research in Financial Markets, vol. 15 no. 1
Type: Research Article
ISSN: 1755-4179

Keywords

Article
Publication date: 8 March 2022

Muhammad Haseeb, Nurul Shahnaz Mahdzan and Wan Marhaini Wan Ahmad

The term “Shariah compliance” states that a firm conducts business activities within the boundaries stipulated by Islamic law. The purpose of this study is to empirically examine…

Abstract

Purpose

The term “Shariah compliance” states that a firm conducts business activities within the boundaries stipulated by Islamic law. The purpose of this study is to empirically examine whether a firm’s Shariah compliance helps in reducing firm-specific stock price crash risk (SPCR).

Design/methodology/approach

Using the data of 10,391 firm-year observations of non-financial public listed firms in Malaysia from 2001–2017, this study uses the panel data estimation technique for regression analysis. Moreover, a series of alternative estimations has been applied to check the consistency of results.

Findings

The findings reveal a significant negative impact of firms’ Shariah compliance on SPCR. The results indicate that Shariah-compliant (SC) firms are less likely to hoard bad news, ultimately reducing SPCR. The results also unveil a possible mechanism through which SC firms reduce SPCR. The findings reveal that SC firms are less likely to be involved in earnings management, which reduces the risk of a stock price crash in SC firms. It highlights the behavioral differences in financial reporting between SC firms and Shariah non-compliant (SNC) firms.

Practical implications

This research adds to the existing literature of Islamic capital markets from the perceptive of SPCR. The SPCR exhibits a tail risk of the stocks and is very important for risk management and investment decisions. The findings of this study will help risk-averse investors to include SC firms in their investment portfolios for risk minimization. The results also guide policymakers and regulatory bodies to rethink the monitoring mechanisms of publicly listed firms.

Originality/value

This study is unique, as it highlights that firms’ Shariah compliance reduces SPCR.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 16 no. 2
Type: Research Article
ISSN: 1753-8394

Keywords

Article
Publication date: 15 January 2018

Rozaimah Zainudin, Nurul Shahnaz Mahdzan and Chee Hong Yet

The purpose of this paper is to analyse the relationship between stock price volatility (SPV) and dividend policy of industrial products firms listed on Bursa Malaysia.

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Abstract

Purpose

The purpose of this paper is to analyse the relationship between stock price volatility (SPV) and dividend policy of industrial products firms listed on Bursa Malaysia.

Design/methodology/approach

The sample comprises 166 industrial products public-listed firms covering a time span from year 2003 to 2012. Using Baskin’s framework, firm’s SPV is related to dividend payout, controlling for earnings volatility, firm size, leverage and growth of assets. Further, the impact of the global financial crisis on the relationship between SPV and the tested variables is examined.

Findings

Earning volatility significantly explains SPV of industrial product firms during the crisis period, while dividend payout ratio (PR) predominantly influences volatility during pre- and post-crisis sub-periods. The empirical results indicate that dividend policy is a strong predictor of SPV of industrial products firms in Malaysia, particularly during the post-crisis period.

Originality/value

The paper explores the firm’s SPV and dividend policy for a new set of data focussing on industrial products firms listed on the Malaysian Stock Exchange.

Details

International Journal of Emerging Markets, vol. 13 no. 1
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 8 July 2019

Rozaimah Zainudin, Nurul Shahnaz Mahdzan, Rosmawani Che Hashim and Noor Adwa Sulaiman

This paper aims to examine the relationship between Islamic religiosity and Islamic financial asset holdings (IFAH) among Muslim individuals in Malaysia.

Abstract

Purpose

This paper aims to examine the relationship between Islamic religiosity and Islamic financial asset holdings (IFAH) among Muslim individuals in Malaysia.

Design/methodology/approach

Data for this study were collected through a survey questionnaire, and a sample of 751 working Muslims in Kuala Lumpur was obtained. Islamic religiosity was measured via religiosity levels and religiosity dimensions. IFAH was measured as the fraction of Islamic financial assets held in a financial portfolio. A generalized linear model (GLM) was used to estimate the relationships.

Findings

The results show that religiosity level influences the IFAH. Devout Muslims held more Islamic financial assets than casual Muslims. All religiosity dimensions influenced IFAH, with faith having the greatest influence and virtues the least. Educational level strongly influenced IFAH.

Research limitations/implications

The sample consisted of working Muslims in Kuala Lumpur; hence, generalization cannot be made to all Malaysian Muslims. This study only focused on Islamic financial assets and did not consider other types of Islamic financial products, such as financing.

Practical implications

Efforts to encourage Muslims to opt for Islamic financial assets may be more effective if they begin from the core of religious education. Educating individuals on Islamic principles, including the values and concepts of Islamic finance, is important to encourage the Islamic banking industry to prosper among Muslims.

Originality/value

The paper provides an extension of current literature on spirituality and religion by incorporating a comprehensive measure of Islamic religiosity and its relationship with financial asset holdings.

Details

Journal of Islamic Accounting and Business Research, vol. 10 no. 4
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 11 September 2017

Nurul Shahnaz Mahdzan, Rozaimah Zainudin and Sook Fong Au

The purpose of this paper is to examine the level of understanding of Islamic banking concepts and the factors that influence Islamic banking adoption in Malaysia, based on…

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Abstract

Purpose

The purpose of this paper is to examine the level of understanding of Islamic banking concepts and the factors that influence Islamic banking adoption in Malaysia, based on Rogers’ (1983; 2003) Diffusion of Innovation. Specifically, the impact of perceived attributes and other variables (understanding, consumer innovativeness and bank personnel’s professionalism) on Islamic banking adoption is examined.

Design/methodology/approach

A quantitative approach using a sample of 200 working MBA students in a leading public university in Malaysia was used. The instrument used was a self-administered questionnaire survey.

Findings

The level of understanding of various Islamic banking concepts is below average. A logistic regression reveals that the understanding of Islamic banking concepts and perceived advantage significantly influences the adoption of Islamic banking services.

Research limitations/implications

The small sample size of 200 individuals may render the findings ungeneralizable. Future studies may use a larger sample from across Malaysia and incorporate other independent variables, such as religiosity and Islamic financial literacy.

Practical implications

The Malaysian government can provide tax incentives and conduct educational roadshows on Islamic banking. Educating prospective consumers on the advantages of Islamic banking as opposed to conventional banking would provide more objective benefits that would boost the adoption of Islamic banking.

Originality/value

The results of this paper will be useful for Islamic financial institutions to increase their marketing and promotional efforts to keep pace with stiff competition within the industry.

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