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Consumer Criteria for the Selection of an Islamic Bank: Evidence from Pakistan

Author

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  • Hasan, Syed Akif
  • Subhani, Muhammad Imtiaz
  • Osman, Ms. Amber

Abstract

Pakistan is a moderate Islamic country, and Karachi its Financial Hub. The Islamic banking industry has seen an enormous growth in the past ten years in the space of Pakistan. This study is intended to observe the criteria of Islamic bank selection for the diversified consumers of Karachi, Pakistani. Ten factors which include Convenience, Quality of services by banks, Religious motives of consumers , Availability of ATM, Privacy & Confidentiality, Bank reputation & Image, Variety in financing options, High profit & Low service charges, Recommendations from friends & family and Friendly & Responsive attitude of banking staff have been taken to investigate the consumer’s criteria for selecting Islamic banking. The findings suggest that High profit & Low service charges is the most important factor followed by Religious motives and Quality of Service for selecting Islamic banking by consumers.

Suggested Citation

  • Hasan, Syed Akif & Subhani, Muhammad Imtiaz & Osman, Ms. Amber, 2012. "Consumer Criteria for the Selection of an Islamic Bank: Evidence from Pakistan," MPRA Paper 40384, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:40384
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    References listed on IDEAS

    as
    1. Mohammad Mansoor Khan & Muhammad Ishaq Bhatti, 2008. "Developments in Islamic Banking," Palgrave Macmillan Studies in Banking and Financial Institutions, Palgrave Macmillan, number 978-0-230-58230-9, February.
    2. Jasim Al‐Ajmi & Hameeda Abo Hussain & Nadhem Al‐Saleh, 2009. "Clients of conventional and Islamic banks in Bahrain," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 36(11), pages 1086-1112, September.
    3. Chong, Beng Soon & Liu, Ming-Hua, 2009. "Islamic banking: Interest-free or interest-based?," Pacific-Basin Finance Journal, Elsevier, vol. 17(1), pages 125-144, January.
    4. Bashir, Abdel-Hameed M., 1999. "Risk And Profitability Measures In Islamic Banks: The Case Of Two Sudanese Banks," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 6, pages 1-24.
    5. Ayesha Hamid & Omar Masood, 2011. "Selection criteria for Islamic home financing: a case study of Pakistan," Qualitative Research in Financial Markets, Emerald Group Publishing Limited, vol. 3(2), pages 117-130, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Mohsina Fatema* & Md. Aminul Islam & Rosni Bakar, 2018. "Halal Purchase Intention- A Study on Islamic Banks of Bangladesh," The Journal of Social Sciences Research, Academic Research Publishing Group, vol. 4(12), pages 402-412, 12-2018.
    2. Muhammad Y. Khan & Shahab Ud Din & Majid J. Khan & Anam Javeed, 2021. "Dynamics of selecting Islamic home financing," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 5005-5016, October.
    3. Tettet Fitrijanti, 2018. "The Influence of Islamic Governance on Minimizing Non-Compliance with Sharia," GATR Journals afr159, Global Academy of Training and Research (GATR) Enterprise.
    4. Mohamed Wail Aaminou & Rajae Aboulaich, 2017. "Modeling Consumers’ Behavior in New Dual Banking Markets: The Case of Morocco," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 20(02), pages 1-24, June.
    5. Ahmad Ali Jan & Muhammad Tahir & Fong-Woon Lai & Amin Jan & Mehreen Mehreen & Salaheldin Hamad, 2019. "Bankruptcy Profile of the Islamic Banking Industry: Evidence from Pakistan," Business Management and Strategy, Macrothink Institute, vol. 10(2), pages 265-284, December.
    6. Alimusa, La Ode, 2019. "Determinants of Muslim Entrepreneurs Decisions 0n Sharia Bank Financing and It's Effect 0n Business Performance," OSF Preprints ja87d, Center for Open Science.
    7. Mahiswaran Selvanathan & Dineswary Nadarajan & Amelia Farzana Mohd Zamri & Subaashnii Suppramaniam & Ahmad Muzammir Muhammad, 2018. "An Exploratory Study on Customers’ Selection in Choosing Islamic Banking," International Business Research, Canadian Center of Science and Education, vol. 11(5), pages 42-49, May.
    8. Sayed Al-Hunnayan & Abdullah Al-Mutairi, 2016. "Attitudes of Customers towards Islamic Banks in Kuwait," International Journal of Business and Management, Canadian Center of Science and Education, vol. 11(11), pages 1-59, October.

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    More about this item

    Keywords

    Islamic banking; religious motives; banking industry;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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