Impact of corporate image on customer loyalty of Islamic banks: the role of religiosity, collectivism, sight cues and CSR

Abstract

Purpose The prime objective of this study is to examine the impact of sight cues and corporate social responsibility (CSR) activities of the Islamic banks on loyalty by improving the corporate image (CI) of the Islamic banks. This study also examines the mediating effect of a CI along with moderating impact of religion and collectivism on loyalty. Design/methodology/approach The data were obtained through the purposive sampling method by distributing questionnaires among the customers of Islamic banks. A total of 550 questionnaires were surveyed from six full-fledged commercial Islamic banks and eight Islamic windows of the commercial bank in Pakistan using variance-based structural equation modelling (partial least squares) to test the hypothesis. Findings The results of the study reflected that sight cues and CSR activities have a significant impact on CI and keeping the customer’s loyalty. Additionally, religion and collectivism also moderate the relationship between CI and loyalty. Research limitations/implications From a managerial perspective, the study finding exhibits the significant effect, both directly and indirectly, of religiosity on the loyalty intention of the customers of Islamic banks. Hence, persuading the client that the bank is in complete compliance with (Shariah) will forestall their clients switching to another bank. Originality/value This study is unique in its nature because it revealed the factors that lead to customer loyalty towards Islamic banks. The study found sight cues and CSR are the new indicators used to build CIs of Islamic banks.