Selection of Islamic banking in a multicultural context: the role of gender and religion

Abstract

Purpose As the popularity of Islamic banking and financial instruments continues to rise globally, a recurring empirical question is what specifically makes consumers choose Islamic banking. This paper aims to investigate the determinants of bank type selection, especially in culturally diverse settings where the Islamic banking sector is well-established. It further examines whether consumers’ gender/religion influences their choices. One intuitive prediction is that Muslim consumers opt for Islamic banking products as “ethical” because of conviction-related reasons. However, the reality is not necessarily straightforward. Design/methodology/approach This paper uses structural equation modeling to examine data collected from a survey questionnaire of 790 respondents in an emerging market setting. Further analysis is made based on gender and religion to remove related bias. Findings Results suggest that overall consumer awareness significantly affects the selection of Islamic banking products. The positive effect of awareness is more significant for Muslim consumers relative to non-Muslims. Interestingly, social stimuli and bank attributes have an insignificant effect on the banking choices of both Muslims and non-Muslims. Practical implications Results suggest that Islamic banks’ marketing managers should adopt differentiated strategies for men and women, focusing on the core benefits of the service or personal interactions with consumers, respectively, along with a focus on different aspects of personal service for each gender. Awareness should be enhanced by adopting informative and effective marketing strategies to attract and retain consumers in the competitive bank environment. Islamic banks (IB) should pay attention to the religious effect without considering it as the sole variable motivating potential customers. They should design segmented and customized marketing strategies based on gender-religion market segmentation to suit different groups’ needs. Originality/value The findings fill a gap in the literature and provide Islamic bankers with insights to help design and articulate their business strategies to appeal to consumers in a multicultural context. Examining an integral part of gender and religion mitigates biased estimates due to the omission of variables. The study contributes to the existing literature on customer preferences for IB with a relatively large, new data set.

They The Role of Gender, Age, And Educational Groups in Utilitarian Motivation for Sharia Products

“…Gender roles determine how men and women should and should not behave (Steiner et al 2022). Men are more selective processors and do not comprehensively process available details before deciding; women go through a more comprehensive process that assimilates all available information before making a decision (ElMassah & Abou-El-Sood, 2021). Men are also considered vital in upholding their principles, while women lead to influencers.…”

“…The explanation is that older individuals were less sensitive to reasons of "lack of documentation," "lack of trust," and "unable to obtain an account" but more sensitive to "religious reasons" (Khmous & Besim, 2020). When individuals are young, they choose Islamic banking because it is based on religion, regardless of the individual's knowledge of the financial instruments provided (ElMassah & Abou-El-Sood, 2021). The age difference can be seen in decision-making because of the gap year due to the environment.…”

Religious affiliation and religiosity: do Islamic appeals in advertising lead to higher purchase intentions among Muslim consumers in Dubai?

“…The study is situated within the discipline of Islamic marketing, as proposed by Alserhan (2011) and Temporal (2011), which seeks to understand the relationship between consumer choice and religious affiliation, in addition to other related variables such as levels of religiosity and the impact of brands specifically related to the practice of Islam, such as halal cosmetics (Suparno, 2020; Suhartanto et al , 2021), halal food products (Muflih and Juliana, 2021; Magsi et al , 2021) and Islamic banking products (Effendi et al , 2021; ElMassah and Abou-El-Sood, 2021). Other notable contributions from Sandicki (2011), Wilson and Liu (2011) and Wilson and Grant (2013), respectively, have sought to define Islamic marketing and Islamic branding further, and a considerable body of empirical work has contributed a great deal to our understanding of the choices that Muslim consumers make, as well as on the potential for the further development of Islamic economies around the world.…”

Consumer behavior in Islamic banking: a systematic literature review and agenda for future research

“…CB research in the IB context has evolved from assessing awareness and perception to exploring decision-making processes, satisfaction, loyalty, adoption, financial inclusion and digital transformation (Suhartanto et al, 2020). Studies have examined factors such as religious beliefs, trust, product attributes, pricing, convenience and customer service to understand consumer preferences and choices (ElMassah and Abou-El-Sood, 2022). Given the widespread research on CB in the IB context, synthesizing the existing literature will provide a comprehensive understanding of consumer preferences, attitudes and behaviors within this context.…”

“…CB research in IB serves as a cornerstone for both academic inquiry and practical implications. By gaining insights into the decision-making processes, attitudes, motivations and expectations of Islamic bank customers, researchers offer valuable guidance for marketers, bankers and policymakers (ElMassah and Abou-El-Sood, 2022). Understanding CB in IB not only helps financial institutions effectively cater to the needs and preferences of their target market but also guides policymakers in shaping regulations and strategies to foster the sustainable development of IB.…”