Evaluating the Customer Satisfaction’s Effect on Murabahah and Mudarabah Financing in Islamic Banking

There are a considerable number of studies on the service quality dimensions of banking industries, but little researches were carried out on the product quality dimensions, and this led to the minimal understanding of the impact of product quality dimensions from the customers’ standpoints, This research sought to identify the impact Islamic banking products (Murabahah and Mudarabah) dimensions on customer satisfaction. The study surveyed Islamic bank customers (users of the Islamic bank’s products in Nigeria) using questionnaires to seek responses, a convenient sampling technique was conducted to reach out to customers, and the use of PLS-SEM 3 was employed for the analysis of the data. The result model shows an R2 value of 0.414 (for Murabahah), which means 41% of the variance in customer satisfaction is explained by the exogenous constructs of perceived quality, cost, convenience and compliance of Murabahah, and R2 value of 0.309 (for Mudarabah) which means 31% of the variance in customer satisfaction is explained by the exogenous constructs of perceived quality, cost, convenience and compliance of Mudarabah. The values of R2 for Murabahah and Mudarabah show that the constructs were moderate in determining the satisfaction level of customers as they produced 0.414 and 0.309 respectively

Study of Direct Relationship Determinants on the Selection of Musyarakah Mutanaqisah (MM) Products

This study analyses the direct relationship of determinants—both intrinsic and extrinsic factors—affecting the selection of MusyÄrakat MutanÄqiá¹£at (MM) house financing products. Intrinsic factors include factors of confidence in sharia compliance value and factors regarding the knowledge level of potential customers. Extrinsic factors include MM product characteristics such as service quality, costs, product benefits and promotions. MM products are emphasised in this study because of their many benefits, including lowering the burden of customers’ monthly payloads, a relatively shorter monthly payment period and increased benefits and profits for both banks and customers. Data were collected from 100 MM customers in Malaysia via the Internet (Facebook) and analysed using Structural Equation Modeling (SEM-SMART PLS) and the Statistical Package of Social Sciences (SPSS) software. The findings show that only the factors of promotion and religious compliance are significant when selecting MM products; in fact, the influence of promotional factors had a greater impact than the influence of religious compliance. Therefore, Islamic banks are urged to increase their promotional strategies in order to provide information about the role of religious law in selecting Islamic banking products, thus helping customers choose MM products that satisfy their needs while also meeting religious demands

Modeling Islamic Economics and Finance Research: A Bibliometric Analysis

This study aims to determine the development map of mathematic model in islamic economics and finance research that is indexed by Scopus and other reputable journal with the keyword "Mathematic model in islamic economics and finance". The data analyzed were 100 selected publications. The development map of mathematic model in islamic economics and finance research analyzed using the VOSviewer application program to find out the bibliometric map. The results showed that the number of publications on the development of mathematic model in islamic economics and finance research indexed Scopus from 1983-2019 experienced a significant increase and the most were published in Journal of King Abdulaziz University: Islamic Economics. Network visualization showed that the map of the development of mathematic model in islamic economics and finance research was divided into 3 clusters. The majority of research is related to modeling of Profit Loss Sharing (PLS) schemes. However, despite the development of using mathematical model in those researches, the approach tends to be adaptive (inductive) from conventional models that already exist. A challenge to review the mainstream model need to be further critically reviewed. Hence, it is necessary for researcher to formulate a mathematical model with a deductive approach that is reduced from Islamic norms or ethics derived from the Alquran and Sunnah

Shariah risk management practices of Islamic banks in Malaysia

Shariah risk management practices are crucial for the stability and reputation of the Islamic banking industry. Thus, the purpose of this study is to determine the factors that influence Shariah risk management practices among Islamic banks in Malaysia Islamic banking staff in the Shariah department in five (5) Islamic banks are surveyed through a questionnaire and the results are used to examine whether Shariah risk management practices is influenced by Shariah risk management process, Shariah board involvement, knowledge and expertise. Additionally, statistical method such as multiple regressions was used to test the hypothesis. This study found that Shariah risk management practices among Islamic banks in Malaysia are moderate. Other findings show that Shariah risk management practices are influenced by Shariah risk management process and expertise in both Shariah and banking operation by the employees. This explains that higher level of Shariah risk management process and expertise among staffs will lead to a higher level of Shariah risk management practices. On the other hand, two independent variables have not given much significant influence on Shariah risk management practices. Although the response rate is 86.08%, it represents beliefs, which are not necessarily translated into actions. This study makes a significant contribution to the academic understanding of Shariah governance in the context of Malaysia, which may guide policy makers, bankers, and customer. It is expected that the results of this study would give realization to the regulators to strengthen and strictly promote the Shariah compliance in all Islamic banking products and services and put a greater emphasize on Shariah risk management. In addition, it is important for the Islamic financial institutions to widen a well-organized and synchronize Shariah risk management process through understanding Shariah risk, proper identification, and assessment of the possible occurrence of the risk as well as monitoring all the products and services to control Shariah non compliance events. Lastly, the Islamic financial institution must train experts that will enhance the Shariah risk management practices through training policies in both Shariah and banking operation, proper qualification among staff and Shariah coordination in ensuring Shariah compliance to attract more customers

Shariah compliant credit cards: Disputes and steps forward / Zaimy Johana Johan.

The major studies on Islamic credit card (ICC) started in 2011 until 2013 specifically examining operations and structures of ICC and behavioural studies. The other studies mostly explored and investigated behaviour and intention to utilise ICC. There are however, few studies comparing between ICC and conventional credit card (CCC) preference. On the same note, only a small number of studies have explored the importance of shariah compliance in influencing the behaviour of ICC adoption. Since shariah compliant credit cards are not popular as compared to the conventional ones, it is timely to review the breadth and depth of ICC studies in order to acknowledge the existence of the product in the market. Whether the product has been unattractive, lack of marketing and promotion from the bankers’ part or the public’s ignorance, insensitivity and unconsciousness about the products, the paper will provide an overview of the research work that has been conducted thus far. The studies on ICC are still limited in numbers and the focus areas are only skewed towards behaviour, satisfaction and the structure of the cards. The key features of ICC that differentiate the product with CCC still remain invisible and unnoticed. There is a critical need to further investigate another perspective of ICC by identifying the key features of shariah compliance and leverage on the benefits to consumers by protecting and preserving basic needs as well as promoting healthy banking environment

Potential use of Islamic finance among Muslims in Port Elizabeth

The resurgence of Islam across the globe combined with the resilience that Islamic financial assets have shown against the onslaught of the current financial crisis, make Islamic finance an attractive alternative financial system. Over the past decade, the Islamic finance sector have shown double digit growth rates beyond the traditional areas of the Gulf Cooperation Council (GCC) regions of Asia as well as other parts of the Middle-East and North Africa (MENA) regions. Research suggests that the future of Islamic finance in Africa depends on business opportunities in South Africa, Kenya, Nigeria and Senegal. The South African government, in conjunction with the national finance authorities, have made their intention clear to position the country as the Islamic finance hub for the rest of the African continent. Despite various marketing campaigns over the past decade to convince the public that Islamic banking and finance is for everyone, non-Muslims generally view Islamic banking as being for Muslims alone. Scepticism towards Islamic finance has resulted in a mere 15 per cent of the estimated 1.5 million South African Muslims currently making use of the sector’s banking and retail instruments. This lack of interest is impacting negatively on the country’s aspirations to establish itself as the gateway of Islamic finance to the rest of Africa. Generally, people’s attitudes toward utilising Islamic finance are regarded as a key obstacle to the development of the Islamic banking and finance system in Muslim minority countries. A Kuwait Finance House research report (2012) highlighted a lack of awareness and knowledge of Islamic finance products and services as key factors stifling the growth of the Islamic finance sector in South Africa. In this context, it was deemed necessary to analyse how knowledge, awareness, expectations, beliefs, perceptions and ancillary external factors impact on potential users’ attitude and decision to adopt or reject Islamic finance.By means of adapting Fishbein’s (2000; 2008) Integrative Model of Behavioural Prediction, a universally-acceptable behavioural-change model, this research explains in a holistic manner how cognitive, affective and environmental measures impact on a Port Elizabethan Muslim’s attitude and eventual decision to accept (or reject) Islamic finance. This study has found that knowledge was the most important variable influencing attitude and intention to use (or reject) Islamic finance. Consequently, this thesis proposed that Islamic institutions should focus their efforts on promoting knowledge and awareness of their products among the South African Muslim and non- Muslim population. As the global Shari’ah finance industry continues its positive growth trajectory, it is imperative that Islamic finance stakeholders in South Africa ensure that they exploit the benefits derived from online learning platforms and assist, by means of cross-border collaborations, more students to have greater access to Islamic finance courses. Furthermore, universities and training institutions are encouraged to offer courses and qualifications in Islamic finance to close the talent gap that currently exist in this particular field of study

A REVIEW OF ARTICLES ON INFRASTRUCTURE CONTRACTORS FINANCING IN THE ISLAMIC BANKING

Construction has become a prominent research topic by many authors from different areas but not in the field of Islamic finance. In financing the infrastructure contractors, the banking industry might be faced with evaluating the overall infrastructure project or the capability of an infrastructure project themselves. Therefore, financing for the construction project or contractor is in a grey area. This paper aims to analyse the topic of study in academic articles authored by scholars about financing the infrastructure construction sector by Islamic banks, in particular infrastructure contractors. Many papers related to financing by Islamic banks discuss fiqh, law, and economic aspects. This is a systematic literature review and was conducted by screening three databases namely Scopus, Ebscohost, and ProQuest from 2001 to 2021. The search was initiated by using three combinations of keywords: Islamic banks, contractors, and infrastructure. The result found that there was a gap in the theoretical and practical knowledge of financing the contractors by Islamic banks. Many papers discuss construction financing using Islamic finance and banking for the full-phase construction segment rather than discussing the contractors

Challenges Facing the Development of Islamic Banking. Lessons from the Kenyan Experience

The purpose of the study was to investigate the challenges facing the development of Islamic banking in Kenya. The research designed for study was a case study approach focusing on four Islamic compliant banks in Kenya. These are: - First Community Bank; Gulf African Bank; Dubai Bank; Kenya commercial Bank Ltd and Barclays Bank Ltd. The population of the study consisted of 33 customers, who were the holders of accounts in the respective banks and 11 managers. Sample data collected by use of questionnaires administered by the researcher and a research assistant. Data analysis method used is based on the quantitative approach using descriptive statistics: mean, mode, and median. Frequency tabulations and cross tabulations were used to bring out the finding of the study. The study revealed Islamic banking compliant was driven by religious compliance and customers need being met. It also revealed that continuous review and improvement of shariah compliant products together with diversifying market niche will lead to drastic development and marketing of Islamic banking products. From the study the following conclusions were drawn: firstly, the factors that influence development of Islamic banking products in Kenya are purely religious compliance and customers need being met. Keyword: Islamic Banking

Factors Influencing Adoption of Cryptocurrency-Based Transaction from an Islamic Perspective

This paper presents a user study of 201C;perception of the cryptocurrency-based transaction from the Islamic views201D;. The motivation lies with the fact that some users of cryptocurrency-based transaction raised concern on the nature of transactions with Bitcoin. Specifically, some argued that Bitcoin can be easily used for illegal purposes. Therefore, 201C;Technological Acceptance Model201D; was adopted and quantitative research methodology was utilized, to formulate and test some hypothesis that will lead to an establishment of a model. Sample of 306 participants was used in the study. The result of the hypothesis testing indicates that 201C;Behavioral Intention to Use Cryptocurrency from the Islamic perspective201D; is influenced directly by Shari2019;ah Compliance, Perceived Ease of Use, Emotionality, Perceived Usefulness, and Financial Concern. As evident from the analysis, Emotionality is influenced directly by Financial concern and Shari2019;ah Compliance. Whereas, Behavioral Intention is influenced indirectly by Financial Concern. The sample is general and does not specify a specific group of study. This study has contributed to understanding the Islamic issues behind the implementation of Cryptocurrency. This study adopted