Customers’ knowledge of Islamic Banking Products and Jaiz Bank Patronage in Northern Nigeria.
ABSTRACT
This work focused on finding the relationship between customers’ knowledge of Jaiz bank Nigeria PLC and patronage of the first full-fledged Islamic bank in Nigeria.
There are various studies on Islamic banking that covered a wide range of issues including those on Islamic bank patronage factors. The studies, which are mostly foreign-based, have documented mixed findings.
The mixed nature of the foreign-based studies provides motivation for further research into the various factors that affect customer patronage of Islamic banks. The broad objective of the study is to examine customers’ knowledge of various Jaiz Islamic banking products and their patronage of the bank.
Along with the broad objectives, specific objectives of the study include ascertaining the effect of customers’ religion, customers’ level of education, customers’ experience, customers‟ product value, customers’ expert insight, and customers’ contextual information on their patronage of Jaiz bank products in northern Nigeria.
The study utilized a survey research design. Data was collected using hand-delivered questionnaires in a survey. The population of this study is 112,000 respondents.
Using a simple random sampling procedure, the sample was found to be 417 respondents made up of 400 Muslims and 17 Christians both male and female were selected to participate in this study.
TABLE OF CONTENTS
Cover Page- – – – – – – – – – – i
Title Page- – – – – – – – – – – iii
Declaration- – – – – – – – – – – iv
Certification- – – – – – – – – – – v
Acknowledgement- – – – – – – – – – vii
Dedication- – – – – – – – – – – viii
Abstract- – – – – – – – – – – x
CHAPTER ONE: INTRODUCTION
1.1 Background to the Study – – – – – – – 1
1.2 Statement of the Research Problem – – – – – 7
1.3 Research Questions – – – – – – – – 10
1.4 Research Objectives – – – – – – – 11
1.5 Statement of Hypotheses- – – – – – – 11
1.6 Scope of the Study – – – – – – – – 12
1.7 Significance of the Study – – – – – – – 13
CHAPTER TWO: REVIEW OF RELATED LITERATURE
2.1 Introduction – – – – – – – – – 15
2.2 The Concept of Customer’s Knowledge – – – – – 15
2.2.1Constructs of Customers‟ Knowledge- – – – – – 17
2.3 Concept and Dimensions of Customer Patronage- – – – – 22
2.4 Overview of Jaiz Bank Product Offerings- – – – – – 26
2.5 Review of Empirical Studies – – – – – – – 34
2.6 Theoretical Framework- – – – – – – – 43
CHAPTER THREE: METHODOLOGY
3.1 Introduction – – – – – – – – – 46
3.2 Research Design – – – – – – – – – 46
3.3 Population,Sample Size and Sampling Technique – – – 46
3.4 Sources of Data – – – – – – – – – 47
3.5 Administration of the Research Instrument – – – – 48
3.5.1 Description of Instrument- – – – – – – – 48
3.5.2 Validity of Instrument- – – – – – – – 48
3.5.3 Reliability of Instrument- – – – – – – – 49
3.5.4 Pilot Test – – – – – – – – – 51
3.6 Data Analysis Method and Model Specification- – – – – 52
3.7 Operationalisation of Variables – – – – – – 56
3.8 Justification of methods Used – – – – – – 57
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.1 Introduction- — – – – – – – – – 59
4.2 Analysis of Response Rate- – – – – – – – 59
4.3 Analysis of Respondents’ Biodata- – – – – – – 60
4.4 Analysis of Descriptive Results for Independent and Dependent Variables 64
4.4.1 Factor Analysis for Independent Variables – – – – – 64
4.4.2 Factor Analysis for Dependent Variable – – – – – – 67
4.5 Revised Framework and Revision of Hypotheses – – – – 69
4.6 Preliminary Analysis – – – – – – – – 70
4.6.1 Descriptive Statistics of the variables – – – – – – 70
4.6.2 Bivariate and Multivariate Relationship between Variables – – – 73
4.7 Tests for Violations of Assumptions for Multiple Regressions- – – 75
4.7.1 Normality- – – – – – – – – – 75
4.7.2 Homoscedasticity- – – – – – – – – 77
4.7.3 Linearity- – – – – – – – – – 78
4.7.4 Multicollinearity- – – – – – – – – 78
4.8 Presentation and Analysis of Multiple Regression Result- – – 79
4.9 Tests of Hypotheses- – – – – – – – 82
4.10 Discussion of Findings- – – – – – – – 85
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSIONS, AND
RECOMMENDATIONS
5.1 Summary of Findings- – – – – – – – 88
5.2 Conclusions- – – – – – – – – – 89
5.3 Recommendations- – – – – – – – – 90
5.4 Theoretical and Managerial Implication of the Study- – – 91
5.5 Limitations of the Study and Recommendations for Further Studies- – 92
REFERENCES- – – – – – – – – – 93
APPENDICES- – – – – – – – – – 108
INTRODUCTION
Over the past four decades, Islamic banking has emerged as one of the fastest-growing industries. It has spread to all corners of the globe and received wide acceptance by both Muslims and non-Muslims alike is one of the most important players in the financial service industry,
Islamic banking is now seen as a business entity striving not only to fulfil the religious obligations of the Muslim community but also, as a business that is needed for winning over other customers whilst retaining the old ones.
Islamic banking has become an integral part of the global banking and finance industry. Since its debut in the 1960s as an alternative to interest-based banking, Islamic banking has continued to grow and expand in both the number of institutions,
assets size and countries in which its products and services are offered. As Hasan & Dridi (2010) state, its remarkable progress over the last four decades as well as its astounding resilience, especially during the global financial crisis of 2007 through to 2009,
have further left admirers as well as acclaimed financial experts to consider it a veritable and competitive mode of financial intermediation that cannot be simply ignored by the global financial system.
As a system of financial intermediation that absolutely prohibits receipt or payment of interest and/or usury in all financial dealings, Islamic banking promotes risk-sharing, encourages entrepreneurship, insists on Shari’ah (Islamic law) compliance of contracts, and promotes moral and ethical values as well as sound corporate governance.
The system has gained recognition and attracted a lot of support from international monetary organizations such as the World Bank and the International Monetary Fund (IMF).
Hassan and Dridi (2010) in a world bank commissioned study, adjudged it to be the fastest-growing segment of the international financial services industry in 2008.
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