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What drives consumer choice of Islamic banking services in the United Arab Emirates?

Author

Listed:
  • Anamitra Shome
  • Fauzia Jabeen
  • Rajesh Rajaguru

Abstract

Purpose - Islamic banking (IB) has witnessed remarkable growth in the past decade. The purpose of this study is to explore some factors that are influencing the choice of Islamic banking and finance (IBF) products and services in the United Arab Emirates (UAE), a predominantly Muslim country. Design/methodology/approach - Students enrolled at a university located in a major emirate in the UAE were asked to respond to a survey on factors underlying their decision to open an account at an Islamic bank. Responses were analyzed using descriptive statistics, analysis of variance and regression analysis. Findings - Results indicate that the decision to open an account with an Islamic bank is influenced by consumer expectations regarding the conformity of the bank’s operations with Islamic principles, as well as consumers’ Arab language skills. Variables such as consumers’ nationality, gender, education and familiarity with IB do not have a significant influence on the decision to open an account at an Islamic bank. Research limitations/implications - The study focuses on university students from a certain Emirate only, which somewhat limits the generalizability of the research results. Nevertheless, the findings of this study may potentially provide some practical insights for further improving and promoting IB, with special reference to the UAE youth market segment. Originality/value - The research is original in nature, particularly as there have not been many instances where the choice of potential consumers (university students) regarding IB and finance services has been explored within the IB sector in a predominantly Muslim nation such as the UAE, an emerging Gulf economy. Consequently, the research findings have important implications for Islamic banks operating in a predominantly Islamic environment.

Suggested Citation

  • Anamitra Shome & Fauzia Jabeen & Rajesh Rajaguru, 2018. "What drives consumer choice of Islamic banking services in the United Arab Emirates?," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing Limited, vol. 11(1), pages 79-95, January.
  • Handle: RePEc:eme:imefmp:imefm-03-2017-0066
    DOI: 10.1108/IMEFM-03-2017-0066
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    Citations

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    Cited by:

    1. Precious Chikezie Ezeh, 2024. "Predictors of Islamic banking adoption among Muslim customers in Nigeria," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 29(1), pages 67-78, March.
    2. Dr. Mohamme Dulal Miath & Mohammed Ali Al Kindi, 2023. "Perception of Small and Medium Enterprises about Islamic Banks in Oman: Evidence from Survey Data," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(10), pages 1572-1585, October.
    3. Macca, Luca Simone & Ballerini, Jacopo & Santoro, Gabriele & Dabić, Marina, 2024. "Consumer engagement through corporate social responsibility communication on social media: Evidence from Facebook and Instagram Bank Accounts," Journal of Business Research, Elsevier, vol. 172(C).
    4. Hind Lebdaoui & Youssef Chetioui & Tahar Harkat, 2024. "Propensity towards Islamic banking among non-users: a mixed-methods analysis," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 29(1), pages 45-66, March.

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