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Persuasion in Islamic finance

Author

Listed:
  • Saad Azmat
  • Haiqa Ali

    (Lahore University of Management Science, Lahore, Pakistan)

  • Kym Brown
  • Michael Skully

    (Monash University, Caulfield East, VIC, Australia)

Abstract

This article explores the mechanisms of persuasion in Islamic finance that may have helped support the growth of this market. Our theoretical model may explain those factors which may influence a customer to select an Islamic financial product. For complex decisions where a person may not fully understand the background concepts such as with finance or Arabic terminology, product quality may be judged based on information in advertising and prior knowledge. Our model shows that Islamic bankers can use the customer’s “coarse thinking†process when advertising products. They may be a means to make products appear more religiously (Shariah) compliant. The equilibrium level of persuasive strategies proposed help reinforces the impact of persuasion for Islamic banks. JEL Classification: G21, G11, M31

Suggested Citation

  • Saad Azmat & Haiqa Ali & Kym Brown & Michael Skully, 2021. "Persuasion in Islamic finance," Australian Journal of Management, Australian School of Business, vol. 46(2), pages 272-286, May.
    • Handle: RePEc:sae:ausman:v:46:y:2021:i:2:p:272-286
    DOI: 10.1177/0312896220926556
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    References listed on IDEAS

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    More about this item

    Keywords

    Investment decisions; Islamic bank; marketing;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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