The Tendency of Customers towards the Acceptance of Islamic Banking in Bahawalpur Region, Pakistan

Abstract

Purpose: the objective of this research report is to examine the tendency of banking customers towards Islamic Banking as compare to Conventional Banking and the awareness of Islamic Banking in its ultimate customers in Bahawalpur region of Pakistan.

Design/methodology/approach: in this study the researcher used both analytical and descriptive forms of research design for this research study. The core purpose of descriptive research is to illustrate the present state of affairs. Analytical research philosophy design is used to investigate the existing facts from the data collected from the target respondents. The sample size consists of 125 customers of Islamic Banks from 20 Banks of Bahawalpur region Pakistan. A comprehensive questionnaire is developed to collect data on a scale for evaluating the theoretical model of this paper.

Findings: factors abstracted from the tendency of customer toward Islamic banking, Interest free banking, Mutual participation, Transparency, Service quality and Marketing strategy have shown significant relations of the customers in using the services of Islamic banking as compared to conventional set up of services provided by banks.

Research limitations/ implication: most of the concerned articles are taken from Malaysia, Kenya and Canada etc countries, limited time for collecting the data and conducting the questionnaire survey. The sample size was small to only 125 respondents but the results are implicated on overall customer's loyalty in Islamic banking. It is suggested that the study should be conducted in the whole country, Pakistan.

Originality/value: the previous studies are country based, but this study has been conducted to specifically focus the Bahawalpur region of southern Punjab, Pakistan which aimed at identifying the accurate response of customer's tendency towards Islamic banking and it could be very useful for cities adopting Islamic banking.

Keywords: Islamic Finance, Services of Islamic Banking, Religious commitment in banking, Interest free banking, Islamic Banking.