Intention to adopt Islamic finance through the mediation of attitudes towards Islamic finance

Abstract

Purpose This paper aims to explore the intention to adopt Islamic finance (ItIF) through the mediation of attitudes towards Islamic finance among microbusiness owners of Pakistan. Design/methodology/approach The study is co-relational and based on cross-sectional data. The authors gathered the data from microbusiness owners through a survey questionnaire. The authors used 236 valid cases to assume the outcomes. Findings The results through structural equation modeling reveal a significant positive effect of the perception of Shariah compliance (PoSC), knowledge of the Islamic financial system (KoIF), religious preferences (RP) and loyalty on ItIF. Furthermore, attitude towards Islamic finance (AtIF) is a potent factor in developing the relationship between PoSC, KoIF, RP, loyalty and ItIF. Practical implications The study’s findings would be helpful for planners and policymakers in developing policies that favourably enhance the attitudes and intentions among individuals towards Islamic financing. The results would inspire readers to go to Islamic finance and an interest-free financial system enriched with Shariah law or Islamic obligations. The study would provide implications for the financial institutions in Pakistan and the rest of the Muslim world. Originality/value The study offers an apparent thoughtfulness of the empirical evidence from microbusiness owners of Pakistan. The study would provide a plausible mediating contribution of AtIF.