Moderation effect on Islamic banking preferences in UAE

2018 ◽  
Vol 36 (1) ◽  
pp. 41-67 ◽  
Author(s):  
Mohammed Hersi Warsame ◽  
Edward Mugambi Ireri
Keyword(s):  
Design Methodology ◽  
Islamic Banking ◽  
Individual Investors ◽  
Content Type ◽  
Moderation Effect ◽  
Moderation Effects ◽  
Bank Managers ◽  
Convenience Sampling ◽  
Conventional Banks ◽  
Practical Implications

Purpose The purpose of this paper is to examine the direct and indirect moderation effects of demographic and socio-economic(s) factors on the adoption of Islamic banking in UAE. Design/methodology/approach Convenience sampling was done on the residents of Sharjah, Dubai, and Abu Dhabi. A closed-ended questionnaire with 30 items was designed and pre-tested before the start of the study. Path analysis and moderation testing were the main analytical approach. A total of 320 respondents completed the survey. Findings The research revealed that demographic and socio-economic(s) moderators may have direct and indirect moderation effects on the adoption of the Islamic banking in the UAE, which indicates the importance of these factors in the provision of Islamic banking products and services in the UAE. Practical implications This study further revealed that these moderators have huge practical implications for Islamic bank managers and marketers as they can exploit these demographics to enhance their market share in the UAE. Social implications In UAE, minimal attention has been directed toward the role moderators would play in the criterion that individual investors would use in the adoption of Islamic banking products and services in a cosmopolitan environment that is experiencing competition from conventional banks. Originality/value An extensive review of the existing literature on the adoption of Islamic banking reveals that no empirical research has been undertaken to explore the role played by demographic and socio-economic(s) moderators in the adoption of Islamic banking in UAE and internationally. This study attempts to fill this gap.

Just how loyal are Islamic banking customers?

2018 ◽  
Vol 36 (3) ◽  
pp. 410-422 ◽  
Author(s):  
John J. Ireland
Keyword(s):  
Conjoint Analysis ◽  
Design Methodology ◽  
Price Sensitivity ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Content Type ◽  
Market Simulation ◽  
Conventional Banks ◽  
The Impact ◽  
Practical Implications

Purpose The purpose of this paper is to determine the rate difference required to persuade Islamic banking customers to switch to conventional banks. Design/methodology/approach A choice-based conjoint analysis survey was administered to 300 UAE Islamic banking customers. Customer utilities for Islamic and conventional banks, products and prices were developed to test hypotheses while a market simulation estimated the impact of rate changes on choice shares. Findings Overall, Muslim customers of Islamic banks strongly preferred Islamic banks and products. However, 43 percent were willing to switch to conventional banks to obtain better rates. Indeed, the share choosing conventional banks rose from 25 percent when rates were the same to 68 percent when conventional products offered 2 percent better rates. Research limitations/implications This research requires replication and extension in appropriate contexts such as Malaysia and Indonesia. Moreover, the existence of price sensitivity tiers implies underlying benefit segments that should be studied. Practical implications As so many Islamic banking customers would switch to conventional banks for better rates, it seems that conventional banks compete with Islamic banks for most clients. Islamic banks should price accordingly. Originality/value This is the first study to quantify the loyalty of Islamic banking customers in terms of price and, consequently, the first to demonstrate the existence of price sensitivity tiers. It is also the first in this field to apply conjoint analysis and market modeling.

Are Islamic banks different? The application of the Radical Affinity Index

2019 ◽  
Vol 12 (1) ◽  
pp. 2-29 ◽  
Author(s):  
Leire San-Jose ◽  
Jon Cuesta
Keyword(s):  
Great Britain ◽  
Design Methodology ◽  
Islamic Banking ◽  
Ethical Dimension ◽  
Islamic Banks ◽  
Ethical Perspective ◽  
Content Type ◽  
Social Commitment ◽  
Practical Implications ◽  
Ethical View

Purpose The purpose of this paper is to extend the literature on Islamic banking by examining their ethical dimension using transparency, placement of assets, guarantees and participation from Radical Affinity Index. Design/methodology/approach To this end, a sample of 20 Islamic banks from 13 countries (Bahrain, Saudi Arabia, Malaysia, Pakistan, Kuwait, Tanzania, Great Britain, Oman, Iraq, Egypt, Bangladesh and Qatar) was used. Findings The results are robust to ethical effects. The evidence suggests that among Islamic banks, at least some of them could improve their ethical requirements of the Sharia; they obtained lower scores than ethical banks in terms of RAI variables (transparency, placement of assets, guarantees and participation). Research limitations/implications It is used a random sample rather than population with the limitations that entails. The variables in the index are based on ethical perspective; then, the index is applied in Islamic banking but with the ethical view limitation. Practical implications The Islamic banks have the option to increase their transparency including further information regarding the beneficiaries of the benevolent funds; moreover, it would offer a clearer view about their ethical and social commitment towards society. Originality/value Additionally, this paper broadens the scope of the literature by analysing the determinants of Islamic banking around ethical dimensions of financial entities.

Beyond customer experience models: identifying idiosyncratic perceptions

2018 ◽  
Vol 36 (7) ◽  
pp. 1311-1328
Author(s):  
Michele Gorgoglione ◽  
Umberto Panniello
Keyword(s):  
Design Methodology ◽  
Scientific Research ◽  
Customer Experience ◽  
Personal Factors ◽  
Content Type ◽  
Segmentation Analysis ◽  
Bank Managers ◽  
Cluster Profiles ◽  
A Company ◽  
Practical Implications

Purpose The purpose of this paper is to demonstrate that a deeper analysis of customer experience (CE) can identify idiosyncratic and critical perceptions in the experiences of groups of customers. Design/methodology/approach The methodology that the authors used is made of three main steps: segmentation analysis, profiling and identification of idiosyncratic clusters’ profiles (i.e. those with a CE perception different respect to the whole sample) and among these idiosyncratic clusters, identification of those that may be critical for the business. Findings The authors identified clusters of customers showing significant differences in their perceived experience with respect to the holistic CE model. Nevertheless, a sample of bank managers assessed three cluster profiles among them to be critical signals a company. The identification of these idiosyncratic patterns provides managers with interesting additional insights that would be hidden in a holistic CE model. Practical implications Managers can gain valuable insights of CE from this analysis that should be added to those coming from an holistic CE model. Originality/value This paper contributes to the scientific research in that it extends the knowledge about CE by showing how personal factors can be identified and how drawing additional managerial insights.

Measuring Shariah non-compliance risk (SNCR): claw-out effect of al-bai-bithaman ajil in default

2017 ◽  
Vol 8 (3) ◽  
pp. 272-283
Author(s):  
Saiful Azhar Rosly ◽  
Muhammad Arzim Naim ◽  
Ahcene Lahsasna
Keyword(s):  
Content Analysis ◽  
Design Methodology ◽  
Islamic Banking ◽  
Legal Environment ◽  
Islamic Banks ◽  
Legal Cases ◽  
Content Type ◽  
Potential Loss ◽  
Critical Requirement ◽  
Practical Implications

Purpose The purpose of this paper is to examine the meaning, nature and measurement of Shariah non-compliant risk faced by Islamic banks. Design/methodology/approach Al-bai-bithaman ajil (BBA) contract documentation is analyzed in the light of the legal environment in Malaysia and measurement of Shariah non-compliant risk based on constructed or hypothetical cases. Findings Shariah non-compliant risk will adversely affect bank’s earnings when BBA contracts are deemed invalid in the court of law, either in a foreclosure or ruling via court declaration. Research limitations/implications The paper is written based on content analysis, Malaysian legal cases with hypothetical examples for better understanding. Practical implications Islamic banking should be able to use the findings to estimate potential loss from Shariah non-compliant risk and make the necessary provisions. Originality/value This paper provides new insights of risks faced by credit-intensive Islamic banks, that when relinquishing critical requirement of Islamic contract such as ownership risk will suffer loss.

Index for measuring convergence between objectives and practice of Islamic banking

2021 ◽  
Vol 14 (2) ◽  
pp. 205-229
Author(s):  
Zahid Siddique
Keyword(s):  
Design Methodology ◽  
Theory And Practice ◽  
Islamic Banking ◽  
Mathematical Form ◽  
Islamic Banks ◽  
Content Type ◽  
Loan System ◽  
Additive Form ◽  
Practical Implications ◽  
Over Time

Purpose Islamic banking was developed to serve two objectives: to replace interest-based loan system with profit and loss sharing investment modes and to promote equity in resource allocation. The first objective is called procedural whereas the second one is termed consequential. Scholars have been debating about the success of Islamic banking in achieving these objectives. This paper aims to develop an index for measuring the extent of convergence between theory and practice of Islamic banking. Design/methodology/approach For measuring the procedural and consequential convergence between objectives and practice of Islamic banking, the paper derives a set of indicators from the celebrated theory of Islamic banking and then develops the methodology of ranking all banks in terms of those indicators. Findings The paper provides ranking of Islamic banks in Pakistan in the light of this index. The results indicate that none of the Islamic banks in Pakistan has been doing good enough to achieve the convergence, instead they are moving in the opposite direction over time. Practical implications Using the methodology developed in this paper, universal ranking of Islamic banks may be issued every year. Originality/value Scholars have proposed some indices for measuring the performance of Islamic banking. There are two basic problems with these proposed measures: they do not directly compare the performance of Islamic banking against its stated objectives and they naively use an additive form of index without explaining the reason for this choice, i.e. as to what are the desirable characteristics which their preferred mathematical form of index serves. The index proposed in this paper attempts to overcome these shortcomings.

An analysis of the normative parameters of reward and risk in Islamic finance

2020 ◽  
Vol 12 (3) ◽  
pp. 303-323
Author(s):  
Mohamed Benaicha
Keyword(s):  
Design Methodology ◽  
Islamic Finance ◽  
Islamic Banking ◽  
Content Type ◽  
Academic Literature ◽  
Finance Industry ◽  
Risk Principle ◽  
Descriptive Approach ◽  
Practical Implications

Purpose This study aims to define the parameters of the reward-risk principle in Islamic finance as established in the literature and discuss propositions that are presented on how such a principle is to be applied to Islamic banking products. Design/methodology/approach A descriptive approach is used to explore the normative parameters and criticisms of the application of reward-risk in Islamic finance. Findings The study finds that the principle of reward-risk is embodied in the multi-component concept of ʿiwaḍ (counter value) which must be evident in market transactions that involve commercial exchanges. The components include risk, costs, effort, value-adding and capital, all of which apply uniquely to different contractual forms of financing. Research limitations/implications The study uses academic literature and industry documents along with modest contact with prominent practitioners who provided general feedback on prevalent Islamic finance industry practices. Practical implications This study exposits the variety of approaches in applying the reward-risk principle and sheds light on the primary elements of the principle which will facilitate its greater consideration by the Islamic finance industry. Originality/value This study is a meaningful attempt at conveniently summing up and applying the parameters that are considered when discussing the scope of the reward-risk principle in Islamic finance.

Determinants of best HR practices in Chinese SMEs

2014 ◽  
Vol 21 (3) ◽  
pp. 414-430 ◽  
Author(s):  
Alexander Newman ◽  
Abdullah Z. Sheikh
Keyword(s):  
Design Methodology ◽  
Cross Sectional ◽  
Content Type ◽  
Hr Practices ◽  
Industrial Sectors ◽  
Wide Range ◽  
Convenience Sampling ◽  
Strategic Relationships ◽  
Cross Sectional Design ◽  
Practical Implications

Purpose – The purpose of this paper is to examine the factors which determine the adoption of best HR practices in Chinese small- and medium-sized enterprises (SMEs). Design/methodology/approach – Regression analysis was utilized to analyse survey data obtained from 345 enterprises operating across China in a wide range of industrial sectors. Findings – Enterprises with greater resources in terms of their size, their relationships with external organizations, their cooperation with foreign partners and the human capital of their CEO were found to be more likely to adopt best HR practices. Contrary to the findings of the existing literature no relationship was found of a relationship between family ownership and the use of best HR practices. Research limitations/implications – The cross-sectional design is an obvious limitation of the study. Other limitations relate to the generalizability of the study findings outside the context in which the research was undertaken, and the use of convenience sampling. Practical implications – Enterprises should consider building strategic relationships with external organizations and developing cooperation with foreign partners as a way of leveraging human resource expertise at a limited cost. Originality/value – This is the first study to examine how differences in the resource endowments of Chinese SMEs influence their adoption of best HR practices.

Innovation in Swedish hotels

2018 ◽  
Vol 30 (6) ◽  
pp. 2481-2498 ◽  
Author(s):  
Wajda Wikhamn ◽  
John Armbrecht ◽  
Björn Remneland Wikhamn
Keyword(s):  
Design Methodology ◽  
Organizational Factors ◽  
Business Environment ◽  
Innovation Strategy ◽  
Future Research ◽  
Web Based ◽  
Content Type ◽  
Hotel Sector ◽  
Convenience Sampling ◽  
Practical Implications

PurposeThe purpose of this paper is to assess innovation in the hotel sector in Sweden and to investigate how structural and organizational factors influence hotel’s likelihood of producing service/product, process, organizational and marketing innovations.Design/methodology/approachThis paper is based on responses from 174 hotels with membership in the Swedish hotel association. Responses were collected via a web-based survey.FindingsThis paper provides insights about the nature and extent of innovations in the hotel sector. Although traditionally considered rigid and non-innovative, around half of the responding hotels produced at least one type of innovation. Most common are service/product and marketing innovations. A hotel’s likelihood of innovating depends largely on structural independence (non-chain), having an explicit innovation strategy and investing in non-traditional R&D.Research limitations/implicationsBecause of the chosen design (convenience sampling), the results of this paper may lack generalizability. Therefore, future research is encouraged to test the hypotheses further.Practical implicationsManagers in the hospitality industry can influence the production of innovations in the hotel sector. By promoting flexibility, defining and communicating an innovation strategy, and engaging in non-traditional R&D activities, practitioners can better respond to the changing business environment.Originality/valueThis paper presents a systematic, and internationally recognized, method for assessing four types of innovation in the hotel sector. Its originality stems also from its approach to investigating how key structural and organizational factors, when considered in the same analysis, predict service/product, process, organizational and marketing innovations.

scholarly journals The early bird and the late bird: which catches more worms in Australia?

2019 ◽  
Vol 15 (4) ◽  
pp. 658-668
Author(s):  
Nirodha Imali Jayawardena ◽  
Akihiro Omura ◽  
Bin Li
Keyword(s):  
Design Methodology ◽  
Price Volatility ◽  
Investment Strategy ◽  
Trading Strategy ◽  
Optimal Time ◽  
Individual Investors ◽  
Content Type ◽  
Day Trading ◽  
Buying In ◽  
Practical Implications

Purpose The purpose of this paper is to examine what the optimal time is in a typical trading day for investors to buy/sell stocks in the Australian stock market. Design/methodology/approach The study mainly focuses on the S&P/ASX200. Each trading day, between 10:00 a.m. and 4:00 p.m., is divided into 30-min blocks. The effectiveness of easily implementable trading strategy to purchase the index in the morning and sell at the close is tested. The study controls for the excess overnight price volatility to improve the effectiveness of the investment strategy. This trading strategy is compared against other 66 possible day-trading combinations. Findings The results show that the trading strategy of buying in the first 30 min of the trading session and close off the position during the last 30 min obtains higher returns than other 66 strategies. Practical implications The day-trading strategy proposed in this study is very simple and therefore can be easily implemented by investors including individual investors. Originality/value To the best of our knowledge, this is the first study which constructs a trading strategy using the J- or U-shaped intraday return pattern.

Effects of Halal social media and customer engagement on brand satisfaction of Muslim customer

2019 ◽  
Vol 11 (6) ◽  
pp. 1671-1689 ◽  
Author(s):  
Syed Alamdar Ali Shah ◽  
Raditya Sukmana ◽  
Bayu Arie Fianto ◽  
Muhammad Ali Ahmad ◽  
Indrianawati Usman Usman ◽  
...  
Keyword(s):  
Social Media ◽  
Design Methodology ◽  
Customer Engagement ◽  
Hierarchical Regression ◽  
Content Type ◽  
Google Docs ◽  
Moderation Effects ◽  
The Relationship ◽  
Practical Implications ◽  
Brand Satisfaction

Purpose The purpose of this research is to examine the factors that affect brand satisfaction of a Muslim customer who is making purchases from selling outlets on social media. Design/methodology/approach The study used a new mechanism of sampling for research studies relating to social media which. Further, we used hierarchical regression to analyze the moderation effects of religiosity. Findings The authors’ findings suggest that religiosity has moderation effects on the relationship between halal social media and brand satisfaction of a Muslim customer and even higher moderation effects on relationship between customer engagement and brand satisfaction of a Muslim customer. Research limitations/implications The respondents of this research are completely unknown as the data has been collected from google-docs link sharing arrangement. Practical implications This study identifies factors that need to be focused on winning the brand loyalty of a Muslim customer. Originality/value This study provides a new sampling methodology to be used for the purpose of studies related to social media, which has been labeled as “social-media disguised snow ball sampling”. Further, this study is one of the few studies in the area of “halal social media”.

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