Awareness and willingness towards Islamic banking among Muslims: An Indian perspective

This study aims to explore the awareness and willingness of Muslim Indians toward Islamic banking. Subsequent to financial crises during the past few decades, Islamic banking has attained global acceptance and has gained a momentum in emerging economies as a substitute for the conventional (interest-based) banking. As India ranks third in terms of Muslim population globally, it is quite spontaneous to analyze the concept of Islamic banking in an Indian perspective.

To collect data, adopting purposive sampling, a sample of 290 Indian Muslims was surveyed in Delhi National Capital Region of India using a self-structured questionnaire. Appropriate statistical tools were applied to analyze the data.

The results concede that majority of the respondents lack an understanding of how Islamic banking works. The results further concede that majority of the respondents are willing to go for Islamic banking if informed properly and offered better customer experience. The results suggest that Islamic banking organizations need to frame effective communication strategies to increase awareness among the populace about how Islamic banking operates.

If approached strategically, one would expect India to be a huge market for Islamic banking. By offering a preliminary understanding about the awareness and willingness of Indian Muslims, this study can prove helpful for organizations to design and deliver informative advertising campaigns to inform potential customers about Islamic banking operations and to ensure the ability to provide efficient service before starting the operations in any country for the first time.

By exploring the awareness and willingness of Indian Muslims, the current study takes an important research gap into account and, therefore, enriches the existing Islamic banking literature.