AN ANALYSIS OF ATTITUDES TO ISLAMIC AND CONVENTIONAL CREDIT CARDS IN MALAYSIA: PERSPECTIVES ON SELECTION CRITERIA AND IMPACT ANALYSIS

The development of everyday financial instruments is an important dimension of modern life, and credit cards are considered to be the main instruments and facilitators of spending in modern economies. Together with the Internet, which facilitates the spending process, credit cards have become essential instruments of spending. In response to this, and due to the expansion of Islamic banking and finance, the Islamic equivalent of credit cards (Islamic credit cards or ICCs) have been engineered with their own sophisticated financing methods alongside conventional credit cards (CCCs). Malaysia is one of the pioneering countries in Islamic finance and has developed a number of ICC products. This study aims to analyse the two main aspects of credit cards, namely, the selection criteria and the impact of credit cards in Malaysia in general, as well as the difference between ICCs and CCCs in particular. The selection criteria are investigated in terms of various factors, including those that explain the first motivation for credit card holding, selection factors influenced by the credit cards’ embedded features, the difference between the satisfaction and the loyalty level of CCC holders as compared to ICC holders, the customers’ perceptions of ICCs, an investigation into whether ICCs are perceived as being inferior to CCCs, religious commitments of ICC holders as opposed to CCC holders, and how the socio-demographic characteristics may have deterministic power over the holding of ICCs and CCCs. The impact of credit cards is investigated through their usage as well as the perceptions of the credit card holders. In conducting the research, this study assembled primary data from Malaysia through a questionnaire survey with 507 participants. In addition, interviews with financiers or bankers, Shari’ah scholars, economists, and cardholders were conducted to verify the results that were established through a quantitative data analysis of the questionnaire. The findings of this study, inter alia, indicate that Malaysian cardholders are found as perceiving credit card selection factors not much differently than individuals in other nations. ‘Protection’ and ‘convenience’ appear to be on the top of the selection list, while ‘reputation’ is in the lowest rank. Furthermore, in investigating the selection attributes, ICC holders were found to value religious factors more highly than in comparison with CCC holders. It was also revealed that ICC holders were less satisfied with having a credit card but they were more loyal than CCC holders. Interestingly, the results also revealed that ICC holders perceived ICCs to be more Islamic than CCC holders, although, in an overall evaluation, ICCs were perceived as inferior to CCCs by ICC holders. It should be noted that the religious commitments among the ICC holders were also higher than those of the CCC holders. Furthermore, the ‘ethnicity’ and ‘religion’ of the socio-demographic variables appear to be significantly related to the holding type. Therefore, the results reveal that religious factors are more influential in the selection process of the ICC holders as compared to CCC holders. In terms of determining the impact of credit cards, the study indicates five determining factors for Malaysian revolving credit cardholders, namely, ‘education’, ‘income’, ‘credit behaviour’, ‘car loan’, and ‘number of credit cards held’. A further analysis to determine the impact between sixteen usage and perception variables with holding type indicates that ICC holders suffer a less negative impact for the use of credit cards in comparison with CCC holders. There is also a higher agreement among respondents in believing that credit card companies use aggressive strategies and misleading advertisements. Importantly, the results also indicate that there is, in reality, no obvious difference between ICC and CCC issuers in marketing their credit cards. It should also be noted that the respondents indicate rationality in their thinking, as the majority admit that widespread credit card debt is due to their self-attitude. This study is useful for various parties, including customers, to examine how credit cards can create financial difficulty. It will also aid financial issuers in understanding the attitudes and perceptions of cardholders, hence, allowing a better strategy in structuring their credit cards. Policy makers, on the other hand, will be able to use it as a guide in implementing policies to curb credit card debt from proliferating

Research on interlocking directorates in family business: evidence from scopus bibliometric data

We examined the trend of studies on interlocking directorates in family businesses using bibliometric data mined from the Scopus database. Search terms including “family business” and seven other variant terms (including family ownership) plus a wildcard (interlock*) yielded only 17 peer-reviewed papers written in the English Language, published between 1999 and 2020. We used graphical tools to summarise the data. Pearson’s r was employed to analyse the data on three of Scopus’ bibliometric indicators (CiteScore, SCImago Journal Rank, and Source Normalized Impact per Paper) using JASP. The only 17 articles on interlocking directorates in family business poorly compare with the 4,792 articles returned when the wildcard was dropped. Thus, the data show that interlocking directorates in family businesses is a grossly neglected niche in the otherwise steadily maturing field of family business research. The distribution of the scanty literature by country of origin, research purpose pursued, theories employed as explanatory frameworks, the most frequently studied interlocking directorate typologies, and their respective implications were pointed out

Determinants of the intention to adopt digital-only banks in Malaysia: The extension of environmental concern

Digital-only banks have not achieved adoption expectations despite being one of the latest innovations in fintech. Several digital-only banks in the United States and Japan have gone bankrupt, and others continue to operate at a loss. Therefore, it is imperative to conduct this study in Malaysia to understand customers’ behavior, particularly regarding the adoption of digital-only banks. With climate change, environmental-friendly behavior, which has been ignored in digital-only bank literature, is becoming increasingly pertinent. This study addresses the lack of an integrated model that investigates the effect of external factors (i.e., critical mass, number of services, and environmental concerns), customer self-determination factors (i.e., trust), and mental perceptions of technology adoption (i.e., convenience, economic efficiency, functional and security risks, as well as perceived value) on the intention to adopt digital-only banks. Data were collected through an online survey targeting Klang Valley residents in the prime age range of 25–54 years old using stratified random sampling. The data was analyzed using structural equation modeling by performing confirmatory factor analysis (CFA) and SEM path analysis in AMOS.v26 software. The results show that convenience, economic efficiency, number of services, trust, perceived value, and environmental concern all have positive significant relationships with the intention to adopt digital-only banks. Further, environmental concern is the strongest indicator of behavioral intention. In contrast, functional and security risks have a negative but non-significant relationship with the intention to adopt digital-only banks. Finally, critical mass has a positive but non-significant effect on the behavioral intention. This study is among the first to examine the influence of environmental concern on behavioral intentions in a digital-only banking context. It also contributes to an expanding body of research investigating environmental sustainability by presenting empirical results in the context of digital-only banks

Less is more: the role of frugality in the Malaysian hotel industry

Purpose: The environmental impact of excessive use of natural resources such as energy and water in the tourism industry has increased significantly. Thus, it is crucial to investigate the notion of frugality in this industry. Particularly, this study aims to examine the effect of green marketing strategies (eco-labelling and environmental advertising) and hotel guests’ green attitude towards frugality in the context of the Malaysian hotel industry. Furthermore, the mediating effect of green attitude is also examined. Design/methodology/approach: Stimulus-organism-response theory was used to develop the research framework. The data were collected via a self-administered survey questionnaire, which yielded 150 complete and usable responses. A partial least square-structural equation modelling approach was used to validate the proposed model. Findings: The results of this study revealed that environmental advertising and eco-labelling, directly and indirectly, affect frugality. Moreover, the link between green attitude and frugality also was supported. Furthermore, data supported the mediating effect of green attitude in the relationship between green marketing strategies and frugality. Practical implications: The findings from this study can benefit hoteliers who are targeting frugal and environmentally conscious consumers. Moreover, the hoteliers will be able to understand the drivers of frugality in the tourism industry. It can assist them to formulate better marketing strategies in attracting and retaining frugal consumers. Social implications: The findings from this study offer a number of important social implications for society, the local government and the city and tourism council. Particularly, understanding the strategies towards frugality can pave the way towards the formation of a “less consumption” community. Moreover, it will serve as the guideline for designing the green and sustainability campaign for the nation. Originality/value: This study is among the pioneers to investigate the issue pertaining to frugality in the tourism industry context. This study examines new linkages such as the indirect effect of green marketing strategies towards frugality. Moreover, the mediating effect of green attitude in the relationship between green marketing strategies (eco-labelling and environmental advertising) and frugality is comparatively a new link

Empowering waqf financing sustainability through capital market in Malaysia: a review

Though the Waqf (Islamic endowment) has been operative for countless years as a superlative instrument that upholds societal welfare, most of the developed and developing countries are yet to entirely utilize Waqf for the capital market investment. This paper aims to review and explore the Waqf financing feasibility through capital market integration from the Malaysian context. Financing tools primarily designed for Waqf assets development are rigorously explored to secure sustainability of Waqf institutions. While embracing the theory of sustainability entailing chief aspects of economics, social and environment as a guiding principle, the study proposes a viable integration of Waqf and capital market instrument of unit trust investments based on the Shariah-compliant. The finding illustrates that there is an essential need for a novel apparatus through the capital market such Waqf unit trust to realize grander Waqf funds accumulation, investment, and distribution. It is exceedingly encouraged that produced proceeds from the investment are optimally utilized for socio-economic projects. This study realizes as one of the pioneer endeavors to group Waqf fund via uni

A multidimensional view of intellectual capital: the impact on innovation performance

The current economic trend worldwide is for an industrial economy based on tangible assets to convert into a non-tangible economy based on intellectual capital. Lately, a multidimensional view of intellectual capital and its implications on innovation performance have generated renewed research interests. Based on these facts, the relationship amongst different antecedent factors such as culture and trust on intellectual capital components was analysed. In addition, a correlation among intellectual capital components (as non-tangible assets) and innovation performance for the banking sector was established. The positivism philosophy, deductive approach and quantitative methods were used as the research methodology to accomplish the research objectives. In this process, a questionnaire survey and purposive sampling technique were used to collect the responses from 364 employees of the Iraqi commercial banks. The obtained data were analysed statistically using the SPSS v25 and AMOS v24 software. The results revealed a significant impact of culture and trust (antecedent factors) on various intellectual capital components. Furthermore, a strong connection between these antecedent factors and intellectual capital components was evidenced, confirming the study hypotheses. Interestingly, intellectual capital components were found to enhance significantly the innovation performance of the banks, leading to better competitive advantages. In addition, it provided evidence on the impacts of inter-relationships amongst human, structural and relational capitals. Consequently, the study provides academicians and practitioners valuable insights into and guidance on how developing intellectual capital enhances competitive performance, especially in the context of Iraqi commercial banks

Creative accounting determination and financial reporting quality: the integration of transparency and disclosure

The phenomenon of creative accounting has attracted the attention of researchers for decades, especially in the financial sector for its implications on the quality of financial reporting. Although several procedures have been developed by researchers and practitioners to determine any manipulation in financial reporting, the practice of creative accounting is still prevalent, resulting in poor quality financial reporting. The present study investigated the moderating role of transparency and disclosure with respect to enhancing the impact of creative accounting determinants and financial reporting quality in the context of commercial banking. A deductive research method driven by a survey questionnaire is used to examine the proposed hypotheses and attain the designed objectives. The analysed data provide a theoretical conceptualisation and practical validation for the integration of the moderator in the relationship between creative accounting determinants and financial reporting quality in banks, with significant advantages. Furthermore, the present research findings show that the degree of impact for creative accounting determinants is linked to the aspects of transparency and disclosure. Lastly, the results present concurrent evidence of the flexibility of creative accounting determinants with implications for transparency and disclosure and financial reporting quality

Perception of Malaysian credit cardholders on conventional cards in comparison to Islamic cards

This study determines the perception of consumers to Islamic Credit Cards (henceforth ICCs) in comparative to Conventional Credit Cards (henceforth CCCs). The aim is to determine whether the low ownership of ICCs was resulted from negative perception of ICCs as compared to CCCs. The data collected via questionnaire survey from Malaysian cardholders revealed that the respondents who accepted the existence of ICCs in the market were five times higher as opposed to those who disagreed. The finding was contradicted to the credit card ownership which revealed that the ownership of CCCs was approximately four times higher than ICCs. Based on the eight variables of perception towards the two products; the study revealed that the respondents perceived ICCs at less comparative advantage compared to CCCs. Hence, the findings support that the low ownership of ICCs resulted from the negative perception on the ICCs compared to CCCs. This paper is useful for banking industry, particularly to the issuing financial institutions in measuring customer perception, which of assistance in the expansion of the market share

Determining a conceptual framework for adoption of Islamic Credit Card in context of Malaysia

The introduction of Islamic banking system in the last years of twenty century have created a new way of applying banking affairs on the basis of Islamic principles. Scholars believe that the scheme is stable in its nature and would enhance the economic development of countries that applied the system. Due to high competition in banking industry of Malaysia, Islamic banks are competitively innovating new products in order to have higher market share and remain competitive. One of the financial products that have been offered by some Islamic as well as dual banks is Islamic credit card. This Islamic product needs to be marketed to better position Islamic banks with diversity portfolio of products. Therefore, this conceptual paper intends to provide a framework that influence different groups of bank customers in the adoption and usage intention of Islamic credit card. The presented framework of this study is based on the perceived attributes of Rogers (2003) Innovation Diffusion Theory. Whilst the trust and attitude in the area of adoption studies has been justified as major determinants in regards with the adoption of Islamic credit card in context of Malaysia, current study extends useful determinants for future research. The findings of the study would be useful for managers as well as decision makers in expanding a better future for Islamic financial instruments

Islamic banking in India: developments, prospects and challenges

Indian financial system has witnessed lot of changes in recent past. The most important of them all are deregulation of Indian banking sector and the opening of new banks. Islamic bank is a new global phenomenon, which India should recognize in developing Indian financial system. This study is carried out to evaluate the developments and to measure the prospects as well as the challenges faced by the movement of Islamic banking in India. This paper reveals that Islamic banking in India has real potential to grow along with the conventional banking system. Our aim is to draw the attention of Indian regulators, Islamic finance scholars and business activists to think over the measures to be adopted in developing Islamic banking in India. It also provides necessary measures to allow conventional banks to carry on Islamic banking business using the existing financial infrastructure