An empirical study on customers' perceptions of interest-free banking in Ethiopia

Irfan Ahmed Sheikh

International Journal of Islamic Marketing and Branding, 2026, vol. 6, issue 4, 313-334

Abstract: Along with the opening of a full-fledged Islamic bank and Islamic windows, interest-free banking (IFB) is a more recent development in Ethiopia's finance sector with a sporadic ten- year history. The industry itself is surviving in infancy stage with a niche market arcane. Therefore, the purpose of the Research article is to investigate how users in Ethiopia perceive Islamic banks and Islamic windows and to recommend for future direction. This study pursues to fill the gap in the prevailing literature and gather information that will aid in expanding the availability of goods and increasing awareness by looking at how customers and bankers perceive issues. The variable in this study is perception remains dependent, and the independent variables are awareness, knowledge, and motivation based on religion. Primary information was gathered from Islamic mode account holders and bankers at that branch. For the study and to draw conclusions, a total of 120 questionnaires were chosen at random. Customers in Ethiopia have a variety of opinions about Islamic banks, according to the study. Some of them questioned if the banks adhere to Islamic teachings. The study revealed that marketing practices, customer-dealings and staff knowledge is inadequate to the extent that there is more of communication gap between banker and the customer. Among reason being the promoters of the interest free are aware about the product operation and literacy but the ground staff itself need training and theoretical and practical knowledge.

Keywords: Ethiopia; customer perception; product knowledge; general banking. (search for similar items in EconPapers)
Date: 2026
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