Customer Satisfaction of Bank

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  • Topic: Islamic banking, Bank, Sharia
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  • Published : December 16, 2012
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International Research Journal of Finance and Economics
ISSN 1450-2887 Issue 94 (2012)
© EuroJournals Publishing, Inc. 2012
http://www.internationalresearchjournaloffinanceandeconomics.com Consumer Criteria for the Selection of an Islamic
Bank: Evidence from Pakistan
Muhammad Imtiaz Subhani
Iqra University Research Centre-IURC, Iqra University- IU
Defence View, Shaheed-e-Millat Road (Ext.)
Karachi-75500, Pakistan
E-mail: drsubhani@yahoo.co.uk
Tel: (92-21) 111-264-264 (Ext. 2010); Fax: (92-21) 35894806
Syed Akif Hasan
Office of Vice President, Iqra University- IU
Defence View, Shaheed-e-Millat Road (Ext.)
Karachi-75500, Pakistan
E-mail: hasandrakif@gmail.com
Tel: (92-21) 111-264-264 (Ext. 1513); Fax: (92-21) 35894806
Muhammad Fayzan Rafiq
Iqra University Research Centre-IURC, Iqra University- IU
Defence View, Shaheed-e-Millat Road (Ext.)
Karachi-75500, Pakistan
Tel: (92-21) 111-264-264 (Ext. 2010); Fax: (92-21) 35894806
Muhammad Nayaz
Iqra University Research Centre-IURC, Iqra University- IU
Defence View, Shaheed-e-Millat Road (Ext.)
Karachi-75500, Pakistan
E-mail: muhammadnayaz@yahoo.com
Tel: (92-21) 111-264-264 (Ext. 2010); Fax: (92-21) 35894806
Amber Osman
Iqra University Research Centre-IURC, Iqra University- IU
Defence View, Shaheed-e-Millat Road (Ext.)
Karachi-75500, Pakistan
E-mail: amber.osman@yahoo.com
Tel: (92-21) 111-264-264 (Ext. 2010); Fax: (92-21) 35894806
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, International Research Journal of Finance and Economics - Issue 94 (2012) 115 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.

Keywords: Islamic banking, religious motives, banking industry 1. Introduction
Islamic banking is an emerging industry. Its wide application is attributed to its ethical banking theory and practice. Islamic banking system not only prohibits usury, but also the association in activities such as uncertainty, liquor, gambling, involving trade relations and insurance products that are considered unethical (Amin, Abdul Rahman, Hwa, & Sondoh Jr, 2011). The main prohibitions on commercial banks are due to the conviction that it is unfair to make a living devoid of the possibility of risk (Siddiqui, 2001). Islamic banking is more like a trade that fundamentally seeks to maximize client’s value and meet their fiscal security needs. It is not considered as a commercial body established only to meet the religious compulsions of the Muslim society (Henry & Wilson, 2004). The main task of Islamic banks has been the accomplishment of sustainable social and economic condition of the country by providing monetary services aligned with the ideology and teachings of Islam (Metawa & Almossawi, 1998).

The Islamic banking industry (IBIs), with an estimated worth of US$1 trillion, is generally measured to be among the most rapidly emerging sectors in the fiscal world (Awan & Bukhari, 2011). Islamic banks reduced the effect of financial crunch to a great extent, which was accomplished with administration of Islamic law, or “Sharia”. IBI is likely to reach US$1.6 trillion by 2012 (Khan & Bhatti, 2008). As a prime Muslim-majority...
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