2002 · 201 citations · 0 references
Customer ExperienceCustomer SatisfactionConsumer ResearchRm21 BillionRetail BankingIslamic Banking ProductsIslamic LawService QualityBankingManagementIslamic Banking SystemIslamic FinanceConsumer BehaviorGeneral BusinessConventional SystemMarketingFinanceCustomer LoyaltyIslamic EconomicsBusinessMalaysian Corporate Customers
Islamic banking was established in Malaysia in 1983, with products offered by both dedicated Islamic banks and commercial banks, yet customer acceptance remains limited. This study investigates why corporate customers in publicly listed Malaysian companies choose or avoid Islamic banking products. The research surveyed respondents’ use of conventional and Islamic banking facilities, their understanding of the Islamic system, and their opinions on various product aspects. By 2000, conventional banks held RM381 billion in deposits and extended RM416 billion in loans, compared to RM31 billion in deposits and RM21 billion in loans for Islamic banks.
Islamic banking system was established in Malaysia since 1983. To date, Islamic banking products are available at two full pledged Islamic banks and at all commercial and merchant banks in Malaysia. However, these products are still not fully accepted by customers. At the end of 2000, total deposit at conventional banks was RM381 billion while total deposit in Islamic system was RM31 billion. In the case of loans, RM416 billion was extended by conventional system, and RM21 billion was given by Islamic system. Since corperate customers are the key players in the economy, it is imperative that the reasons for them to choose or not to choose Islamic system be studied.This seminal study explores the perceptions of persons responsible in financial affairs of public listed companies in Malaysia. Among issues covered in this study were usage of conventional and Islamic banking facilities, respondents’ understanding of Islamic banking system, and their personal opinion on various aspects of Islamic banking products.