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STS419 Zuraeda Ibrahim et al.
Investment Account (IA) in Islamic Banking:
Analysis of perceptions, knowledge and
acceptance of corporate consumers on IA
concept using structural equation modelling
2
Zuraeda Ibrahim , Hamim Syahrum Ahmad Mohktar , Zafiruddin Baharum ,
1
1
3
2
2
Muhammad Syahmi Mohd , Shariza Abdul Ghani , Azren Rizuani Aziz
1 Faculty of Accountancy, Universiti Teknologi MARA, Selangor, Malaysia
2 Central Bank of Malaysia, Kuala Lumpur, Malaysia
3 International Shari’ah Research Academy for Islamic Finance, Kuala Lumpur Malaysia
Abstract
The strategic efforts of Bank Negara Malaysia to ensure financial stability of
the Islamic banking sector include the process of redefinition and
reclassification the fund raising instruments of Islamic banks into deposits and
investment. This is to correctly reflect the underlying Shariah requirements for
each instrument separately. Lack of understanding and unfamiliarity of the
underlying Shariah concept may deter a majority of Islamic banking
consumers from placing funds in the Islamic investment accounts with Islamic
banks and this may impact negatively on the Islamic banks as well as the
financial stability of the sector in general. Hence, investigating and analyzing
the stakeholder’s perception, knowledge and acceptance on this new concept
of investment account under the Islamic Financial Services Act (IFSA) is of
paramount importance to Bank Negara Malaysia. A survey has been
conducted; and the questionnaires have been distributed to the corporate
consumers of all the Islamic banks in Malaysia, which includes businesses and
government institutions. In this study, usable data were collected from a total
141 respondents; however only 44 responses have been further analysed. The
respondents of this survey consist of public listed companies (38.6%), non-
listed companies (25.0%), government-linked companies (18.2%) and 13.6%
are government ministries or agencies (13.6%). The data set were subjected to
analysis using structural equation modeling (SEM) based on the PLS approach.
Results from the SEM analyses on the corporate consumers demonstrated that
only one (1) factor, consumers’ acceptance, has a significant relation with
understanding of the investment account concept. Consumers with better
understanding of the concepts have a higher level of product acceptance.
Results also indicate that consumers’ perception, knowledge and refusal are
not related, and nor do they influence consumers’ understanding of the
investment account concept.
Keywords
Islamic investment accounts; Corporate Consumers behaviour; Islamic Banks
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