Growth and challenges of the Islamic banking system: A perspective of the British Bangladeshi Muslim Community in London, United Kingdom
During recent years, there has been an increase in Islamic banking compared with conventional banking. This research aims to explore and determine potential factors pertaining to the growth of the Islamic banking system in the banking and finance industry and asks the following questions: i) Which factors influence the British Bangladeshi Muslim Community (BBMC) in Greater London regarding adopting the Islamic banking system? ii) Do the Muslim scholar's inconsistent views create any confusion about or obstacles to the growth and development of the Islamic banking system? In this study, the researcher used a mixed methodology. From Greater London, 165 British Bangladeshi and Bangladeshi by citizen status Muslims participated and shared their views through the questionnaire. In addition, the researcher conducted 17 interviews with prominent British Bangladeshi Muslim Community members, such as Muslim Scholars, community leaders, banking practitioners and Islamic bank Shariah Board Members. The SPSS 22 software programme was employed for the data analysis. The findings indicate that, in the BBMC, religious beliefs, faith and obligation play a prominent role in the adoption of Islamic banking rather than conventional banking. The UK’s financial regulators are playing a decisive role in this growth and development. Furthermore, a higher level of commitment has evolved amongst BBMC members towards the growth of this banking system, despite a lack of understanding of it, where the products and services are perceived as less competitive and limited in range. Moreover, the ongoing Muslim scholar’s inconsistent views also create contradictions and confusion amongst both customers and non-customers of the Islamic bank. This, in turn, might impede the future growth and development of this banking system. This research will contribute to increasing the knowledge of those in authority who are concerned with understanding the BBMC’s socio-economic conditions. Because, the BBMC is a surrogate measure of broader Muslim communities Islamic banking system perception of growth. This research will also increase knowledge of how Islamic banks are using brand image and ethical principles in their successful operations in the banking and finance industry, so that other financial organizations can develop their operation strategies based on the Islamic banking system. The correlation between the financial and community-based performance of Islamic banks can be studied for future research.
BP Islam. Bahaiaeth. Theosoffi, ac yn y blaen, HJ Cyllid Cyhoeddus
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