Analytical Study of the influence of Relative Advantage and Compatibility on Customers’ Adoption of Islamic Banking in Pakistan

Abstract

Although Pakistani Islamic banks offered consumers of Islamic banking and the country at large desirable opportunities, customer adoption remained low in Pakistan. Rogers' (2003) Diffusion of Innovation Theory was used in this study to examine the effects of relative advantage and compatibility on customer adoption of Islamic banking goods and services in Pakistan. The study looked at how adoption is directly impacted by relative advantage and compatibility. Relative advantage and compatibility were found to have a considerable impact on adoption, supporting hypotheses H1 and H2.