Business entrepreneurs’ intention towards takaful participation to mitigate risk: a study in Sri Lanka based on the theory of planned behaviour

Purpose - Takaful is a social security approach that guarantees business risks in light of shari’ah, thus playing a crucial role in human life and the economy. The purpose of this study is to examine the factors that influence the behavioural intention of micro, small and medium-sized enterprises (MSMEs) entrepreneurs to participate in takaful in Sri Lanka. Design/methodology/approach - This study is designed quantitatively with deductive approach using the theory of planned behaviour. A total of 432 MSMEs in Sri Lanka were surveyed using convenience sampling to measure the intention to participate in takaful as a risk mitigation. The collected data were analysed through partial least square-structural equational modelling. Findings - Attitude, subjective norm and perceived behavioural control variables positively influenced the intention, witht-values of 3.216, 3.813 and 3.859, respectively. The influence of these variables exhibits not much difference. Research limitations/implications - This study only focuses on MSMEs and a general takaful scheme. Future researchers may consider family takaful involvement among Sri Lankan business entrepreneurs. Practical implications - Takaful practitioners should gain from the entrepreneurs’ intention to participate in takaful. Findings from this study could help marketing managers to revamp their strategies to further attract the entrepreneurs and make them to understand risk they are facing and, subsequently, participate in the takaful scheme. Originality/value - This paper focuses on the context of Muslim minority among pluralism, where there is no regulation for Islamic financial products and services, and under the Islamic financial market crisis. This unleashes how business owners feel about takaful system on different dimensions.