Determinant of customers’ preference in selecting Islamic banks

Abstract

The presence of conventional bank and Islamic bank in Malaysia has created a competition in capturing customer. Customer of Islamic bank maintained their account with the bank if they are satisfied with the product and services offered to them. Other research reveals that the reasons for Muslim to choose Islamic banking are mostly due to religious concern and motives. This study investigates the relationship between religions; influence by family and friend and finally service quality with customers' behavior towards bank selection preferences. Data was collected from 380 customers using self-administered questionnaires from various Islamic banks in Miri. Results reveal that service quality and preference of choosing Islamic bank in Miri has a strong and positive relationship. Ultimately, friends and family has more impact towards preference in choosing Islamic bank. Recommendation for future study also discussed.