ISSN: 2222-6990
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This research develops the understanding of the methodology and the application of Analytical Hierarchy Process (AHP) in the selection of the best criteria for Islamic banking. The AHP is a general problem-solving methodology that is useful for complex multi-criteria decision-making with variables that do not have the exact numerical consequences. The research study was undertaken involving bank customers in the Northern region of Malaysia. The objectives of the study are to identify the most important criteria for selecting Islamic banking by customers and to determine the major factors of selecting Islamic banking based on demographic variables (gender, religion). The AHP evaluates a hierarchy of criteria of the study including bank status, facilities provided, convenience, religion status, bank reputation, Sharia’ issues, staff friendliness, and profitability. The best criterion which was chosen by all respondents was Sharia’ issues while bank status was the least preferred by the customers. In addition, in analyzing the major factors of selecting Islamic banking between demographic variables, the most important criteria chosen by gender was Sharia’ issues for males and bank reputation for females. Furthermore, the most important criterion chosen by Muslims was Sharia’ issues and convenience factor for non-Muslims. These findings benefit the banks and customers: the bank is able to identify their potential customers and specific customer segments, while creating awareness for customers to choose Islamic banking. Future research would include other variables in the survey instrument such as safety and security.
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In-Text Citation: (Januri et al., 2021)
To Cite this Article: Januri, S. S., Pozi, M. A. M., Nadzri, M. H., & Zainuddin, M. S. (2021). Factors Influencing of Islamic Banking by Customers: A Case Study in Northern Malaysia. International Journal of Academic Research in Business and Social Sciences, 11(7), 720–735.
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