Muslim and non-Muslim consumers’ perception towards introduction of Islamic banking in Ghana

Abstract

PurposeThis study aims to examine consumer perception of introduction of Islamic banking (IB) in Ghana, which is a new and emerging form of banking in many non-Islamic countries. Design/methodology/approachEmpirical field data were collected from a sample of 975 respondents using self-administered structured questionnaire. Descriptive analysis was conducted using SPSS version 16. FindingsMuslim respondents have significantly positive perceptions of IB compared to non-Muslims and have stronger intentions to adopt IB in Ghana than non-Muslims. Non-Muslims have high perceived benefit of IB. Non-Muslim respondents do not perceive potential threat of violence associated with the introduction of IB in Ghana. Although non-Muslims perceive IB that would make Islam popular, they do not perceive it as a means of Islamizing bank customers. Relatively, non-Muslims appear to have low knowledge of IB, unfavourable attitude towards IB, are reluctant to comply with Sharia law and consequently have weaker intentions to adopt IB. Research limitations/implicationsThis study was limited to descriptive analysis and to only Ghana. Future research should quantitatively model IB adoption and switching factors using samples from other developing countries. Practical implicationsIB institutions could focus on attracting a niche of Muslim consumers at its initial stages. Moreover, to facilitate the introduction of IB, the Bank of Ghana and other relevant stakeholders, in addition to establishing effective governance structures, must promote consumer education to enhance consumer knowledge of IB and correct misconceptions about IB among consumers, particularly non-Muslim customers. Originality/valueOne unique contribution of this study is that it provides an initial empirical exploration of consumers’ attitude and perceptions of IB in Ghana, which is an under-researched area.