A Comparative Analysis on Bankers’Perceptions on Islamic Banking

Abstract

This research was conducted to gauge the perceptions of employees, in both Islamic banks and conventional banks, of Islamic products and services, the training and experience gained in Islamic banking, and the potential of Islamic banking in Malaysia. Questionnaires dealing with Islamic banking were distributed to bankers in the northern part of Malaysia. The results revealed that bankers in Islamic banks have more positive perceptions on the above issues. Interestingly, few of the bankers possessed a relevant academic background or relevant experience in Islamic banking before embarking on this career. The bankers also claimed that they had very limited knowledge in this area prior to working with the banks; thus, the issue of the availability of well-trained and skilled employees must be addressed critically by the government, industry players and educationists for the sustainable growth of Islamic banking in Malaysia, and to meet the target set for the year 2010.

Factors Influencing Products’ Knowledge of Islamic Banking Employees

“…However, further analysis found that only underlying principle and training are having significant influence to the product knowledge of employees. The finding corresponds to the study by Zainol et al (2008) and Aslam et al (2011), who also found that training is one of the important factors that the management used to evaluate the knowledge of their banking staff. By having insufficient trainingand working experience, the Islamic banking employees cannot provide accurate knowledge of the products and persuade the customers to use the Islamic banking products.…”

“…In general perception is the ability to understand the differences and often identified by the level of satisfaction on certain products or services. Previous studies found that there was a positive perception of training and experience on Islamic banking among bankers in Malaysia (Zainol et al, 2008). Likewise it is found in Pakistan by Aslamet al (2011) that bankers in the Islamic banks have more positive perception on issues compared to bankers of conventional banks.…”

“…It can be considered as a course of action which creates the qualities in human resources to make them more productive in order to achieve the organizational goals (Hashim, 2009). Islamic bankers reported having more knowledge than conventional bankers (Zainol et al, 2008). They reported bank employees are lack of training and many of them do not have skill in Islamic product principles.…”

“…In the banking sector, Malaysian bankers are reported have limited knowledge of Islamic banking products and services (Zainol et al, 2008) where they do not have sufficient knowledge regarding to Islamic banking products and services (Aslamet al, 2011). Meanwhile, Baba and Amin (2009) revealed that most offshore bankers were not knowledgeable about Islamic banking where they had confused notions regarding the practices of Islamic banking system.This indicates that level of knowledge among the bankers themselves is still limited since they were not knowledgeable about Islamic banking system.…”

“…The survey instrument for product's knowledge (Osman and Ali, 2008;Khan and Asghar, 2012), religiosity (Ahmad et al, 2008), perception (Ling et al, 2012;Akbar et al, 2012) and training (Zainol et al, 2008) were developed based on the previous researchers; however some improvement on items were made and added to the constructs to suit with the environment of the study. Whilst, the measurement of underlying principle variable was fully constructed by researchers.…”