Coke and Pepsi Learn to Compete in India

www.ajbms.org
ISSN: 2047-2528

Asian Journal of Business and Management Sciences
Vol. 2 No. 10 [38-50]

Analysis of Customer Satisfaction with the Islamic Banking Sector:
Case of Brunei Darussalam
Mohamed Sharif Bashir
Imam Centre for Banking and Finance
Al-Imam Muhammad Ibn Saud Islamic University
Riyadh 11432, Kingdom of Saudi Arabia
E-mail: [e-mail].
ABSTRACT
During the last decade, the Islamic banking sector in Brunei Darussalam experienced remarkable and increasingly challenging development in the face of strong competition from conventional banks. The main objective of this paper is to examine the effects of both service quality and product quality, and of satisfaction awareness of Islamic banking in Brunei Darussalam. This study also examines the reasons that consumers select Islamic banking. A questionnaire survey was conducted among Islamic banks’ customers. The findings show that the indirect effects of service quality and product quality on satisfaction awareness were positive and significant. They also revealed that consumers were aware of Islamic banking products and services to a certain degree; and the reasons for preferring them were profitability and religious principles. As a result, these findings provide the Islamic banking industry with helpful guidelines in its efforts to formulate suitable promotional policies to attract more banking customers.
Keywords: Islamic banking, Islamic finance, customer awareness, customer satisfaction, service quality, Brunei Darussalam.
1. INTRODUCTION
Customer satisfaction has been perceived as a key factor in finding out why customers leave or stay with a bank. Generally, any bank needs to know how to keep their customers, even if they seem to be satisfied. As competition within the financial services industry is more intense than ever, and as banking companies’ service menus are becoming increasingly comparable, the need to understand bank customer satisfaction

References: Abratt, R., & Russell, J. (1999). Relationship marketing in private banking in South Africa. Ahmad, N. and Haron, S. (2002), Perceptions of Malaysian corporate customers towards Islamic banking products and services, International Journal of Islamic Financial Armstrong, G., & Kotler, P. (1996). Principles of marketing. (7th ed.). India: Prentice Hall. Bank Islam Brunei Darussalam. (2007). Annual report. Brunei Darussalam: Author. Bashir, M. S. (2012). Awareness, service quality and product effects on satisfaction of Islamic banking in Brunei Darussalam Conference on Management (2nd ICM 2012) 11th-12th June. Holiday Villa Beach Resort & Bashir, M. S., & Mail, N. H. (2011). Consumer perceptions of Islamic insurance companies in Brunei Darussalam Bashir, M. S., Machali, M. M., & Mwinyi, A. M. (2012). The effect of service quality and government role on customer satisfaction: Empirical evidence of microfinance in Bitner, M. J. (2001). Service and technology: Opportunities and paradoxes. Managing Service Quality, 11(6), 375-379. Bitner, M. J., & Zeithaml, V. A. (2003). Service marketing. (3rd ed.). New Delhi: Tata McGraw Hill. Caruana, A. (2002). Service loyalty: The effects of service quality and the mediating role of customer satisfaction Colgate, M., Stewart, K., & Kinsella, R. (1996). Customer defection: A study of the student market in Ireland Cronin, J. J., & Taylor, S. A. (1992). Measuring service quality: A re-examination and extension Doraisamy, B., Shanmugam, A., & Raman, R. (2011). A study on consumers’ preferences of Islamic banking products and services in Sungai Petani Dusuki, A. W., & Abdullah, N. I. (2007). Why do Malaysian customers patronize Islamic banks? International Journal of Bank Marketing, 25(3), 142-160. Erol, C., & El-Bdour, R. (1989). Attitudes, behaviour, and patronage factors of bank customers towards Islamic banks Göksu, A., & Becic, A. (2012). Awareness of Islamic Banking in Bosnia and Herzegovina. Hamid, A., and Nordin, N. (2001). A study on Islamic banking education and strategy for the new millennium: Malaysian experience Hamid, M. A., Yaakub, N. I., Mujani, W. K., Sharizam, M., & Jusoff, K. (2011). Factors adopting Islamic home financing: A case study among consumers of Islamic banks Haron, S., Ahmed, N., & Planisek, S. (1994). Bank patronage factors of Muslims and nonMuslim customers. International Journal of Bank Marketing, 12(1), 32-40. Hassain, M., & Leo, S. (2009). Consumer perception on service quality in retail bank in Middle East: The case of Qatar Hassan, A., Chachi, A., & Latiff, S. A. (2008). Islamic marketing ethics and its impact on customer satisfaction in the Islamic banking industry Ho, G. T. S., Lau, H. C. W., Lee, C. K. M., and Ip, A. W. H. (2005). An intelligent forward quality enhancement system to achieve product customization Iglesias, M. P., & Guille’n, M. J. Y. (2004). Perceived quality and price: Their impact on the satisfaction of restaurant customers Islamic Bank of Brunei Bhd. (2000). Annual report. Brunei Darussalam: Author. Kayis, B., Kim, H., & Shin, T. H. (2003). A comparative analysis of cultural, conceptual and practical constraints on quality management implementations-findings from Kessler, S. (1996). Measuring and managing customer satisfaction: Going for the gold. Khan, M. S. N., Hassan, M. K., & Shahid, A. I. (2007). Banking behaviour of Islamic bank customers in Bangladesh Khattak, N. A., and Rehman, K. (2010). Customer satisfaction and awareness of Islamic banking system in Pakistan Latiff, S. A. (2007). Islamic banking in Brunei and the future role of Centre for Islamic Banking, Finance and Management (CIBFM) Metawa, S. A., & Almossawi, M. (1998). Banking behaviour of Islamic bank customers: Perspectives and implications