Beyond Profit: A Faith-Driven Framework for Customer Satisfaction in Melaka’s Islamic Financing Sector

Beyond Profit: A Faith-Driven Framework for Customer Satisfaction in Melaka’s Islamic Financing Sector

Muhammad Fairuz Jamil^1*, Norhafidzah AB Rahaman², Mastura Roni³, Wirdawati Ahmad@Mohd Isa⁴

^1*3Faculty of Business and Management, Universiti Teknologi MARA (UiTM) Cawangan Melaka Kampus Bandaraya, 100 Off Jalan Hang Tuah, 75350 Melaka

²Department of Accounting & Economics, Kolej Profesional MARA Bandar Melaka, 146 Jalan Hang Tuah, 75350 Melaka

⁴ Department of General Studies, Politeknik Tun Syed Nasir Syed Ismail Hab Pendidikan Tinggi Pagoh, Km 1, Jln Panchor, 84600 Pagoh, Muar Johor

*Corresponding Author

DOI: https://dx.doi.org/10.47772/IJRISS.2025.909000101

Received: 25 August 2025; Accepted: 04 September 2025; Published: 30 September 2025

ABSTRACT

Islamic finance has gained prominence as a value-based alternative to conventional banking, especially in Muslim-majority countries like Malaysia. Despite national-level growth, the impact and reception of Islamic financing in regional contexts such as Melaka remain under-explored. This conceptual paper proposes a framework to examine customer satisfaction with Islamic financing services in Melaka, integrating Ajzen’s Theory of Planned Behavior (TPB), the SERVQUAL model, and core Islamic finance principles such as Shariah compliance. The framework identifies five key determinants of customer satisfaction: Shariah compliance, service quality, transparency, customer trust, and product accessibility. The research further introduces religiosity as a moderating variable that intensifies the impact of these determinants; particularly Shariah compliance and trust on customer satisfaction. This study advances the theoretical understanding of Islamic consumer behavior by contextualizing satisfaction within both behavioral and ethical-religious paradigms. It acknowledges that Muslim consumers’ satisfaction extends beyond functional service elements to include alignment with spiritual and moral values. While grounded in established models, the framework addresses gaps in the literature by emphasizing regional dynamics and the interplay of religiosity. The paper concludes by highlighting practical implications for Islamic financial institutions in Melaka and similar markets, offering actionable insights for enhancing customer loyalty, service design, and ethical financial engagement. The proposed model also sets a foundation for future empirical testing and refinement within semi-urban Islamic finance landscapes.

Keywords: Conceptual framework, Customer satisfaction, Islamic finance, Religiosity, Shariah compliance, Service quality

INTRODUCTION

Islamic finance has emerged as a significant component of the global financial landscape, offering ethical and Shariah-compliant alternatives to conventional banking systems. In Malaysia, the Islamic financial sector has grown rapidly over the past two decades, contributing significantly to financial inclusion and national economic development (Bank Negara Malaysia, 2023). Among the core services offered by Islamic banks are Islamic financing products, which are structured based on profit-and-loss sharing or trade-based contracts, avoiding interest (riba) in adherence to Islamic law. Contracts such as Murabaha (cost-plus sale), Ijarah (leasing), and Musharakah (partnership) provide consumers with financing options grounded in religious principles and ethical conduct (Haniffa & Hudaib, 2007).

As evidenced by recent studies showing their substantial impact on profitability and financial performance in Islamic banking institutions continue to be important tools in Islamic financing, providing customers with morally sound and Sharia-compliant alternatives to traditional financing (Echamawaty & Safira, 2024; Sari, Anggraini, & Syakir, 2024; Zulvia, Lisa, & Farhan, 2024). Despite the robust development of Islamic finance in urban centers, its effectiveness and customer reception in regional states like Melaka have not been widely examined. Melaka, with its culturally diverse population and economic dynamism, represents a valuable case for studying customer perceptions of Islamic financing services. While Islamic financing is theoretically designed to appeal to Muslim consumers, questions remain regarding whether these products meet customer expectations in terms of service quality, transparency, trust, and Shariah compliance.

This paper addresses the conceptual gap by proposing a framework to investigate the relationship between Islamic financing characteristics and customer satisfaction in Melaka. The study is grounded in the Theory of Planned Behavior (Ajzen, 1991), which links beliefs and attitudes to behavioral intentions, and the SERVQUAL model (Parasuraman et al., 1988), which identifies dimensions of service quality influencing consumer satisfaction. Additionally, the role of religiosity as a moderating variable is considered, as previous studies have shown that religious commitment significantly influences the acceptance of Islamic financial products (Dusuki & Abdullah, 2007).  The central argument of this study is that customer satisfaction with Islamic financing services is shaped not only by financial considerations but also by the alignment of services with ethical and religious expectations. By developing a localized conceptual framework, this study contributes to a better understanding of Islamic consumer behavior in semi-urban settings and provides practical insights for improving the quality and delivery of Islamic financial services in Melaka.

LITERATURE REVIEW

The growing appeal of Islamic financial services has sparked considerable academic interest in understanding the factors that drive customer satisfaction. In Islamic banking, satisfaction is not solely determined by the financial performance of products, but also by their alignment with religious principles and ethical values. To understand customer satisfaction with Islamic financing, particularly in regional contexts like Melaka, this study draws upon several key concepts: Shariah compliance, service quality, customer trust, religiosity, and perceived value.  Shariah compliance is a foundational pillar in Islamic finance. It ensures that financial products adhere to Islamic legal and ethical standards, such as the prohibition of interest (riba) and uncertainty (gharar), and the exclusion of unethical investments.

For many Muslim consumers, compliance with Islamic law is not just a technical feature but a moral necessity. According to Dusuki and Abdullah (2007), customers view Shariah compliance as a reflection of institutional integrity and ethical commitment, which significantly enhances trust and satisfaction. Amin and Isa (2008) further support this view, emphasizing that customers in Malaysia often prioritize religious conformity over purely economic benefits when choosing financial services.  Service quality remains a universally recognized determinant of customer satisfaction, yet in the Islamic banking context, it takes on culturally specific meanings. Parasuraman, Zeithaml, and Berry’s (1988) SERVQUAL model identifies five dimensions which are tangibility, reliability, responsiveness, assurance, and empathy that contribute to service excellence. In Islamic finance, however, these dimensions are often interpreted through an ethical-religious lens. Kashif et al. (2016) highlight those qualities such as empathy and assurance must align with Islamic principles like amanah (trustworthiness) and ihsan (excellence in conduct), which are deeply valued by Muslim customers. This adaptation enhances the relevance of the SERVQUAL model in Islamic banking environments, but also signals the need for more context-specific applications.  Closely linked to service quality and Shariah compliance is the concept of customer trust.

In conventional banking, trust is largely built on reliability and professional competence. In Islamic finance, however, trust extends to the institution’s ability to uphold and implement Islamic values. Haniffa and Hudaib (2007) argue that trust in Islamic banks is often shaped by perceptions of the bank’s Shariah governance, transparency in contract structuring, and the authenticity of their religious commitments. A breach in any of these areas may result in a loss of confidence and, ultimately, customer dissatisfaction.  Religiosity plays a unique moderating role in shaping customer behavior within Islamic banking. Drawing on Ajzen’s (1991) Theory of Planned Behavior, which links beliefs and attitudes to behavioral intentions, religiosity can significantly influence the customer’s decision-making process.

Highly religious individuals are more likely to choose Islamic financing and tolerate minor service inefficiencies if they perceive the product to be in line with Islamic teachings. Dusuki and Abdullah (2007) found that customers with stronger religious beliefs are more likely to display loyalty to Islamic banks and exhibit higher satisfaction when Shariah values are visibly upheld. In addition, Fatmawati, Irianda, & Abilawa (2024) stated that customers exhibiting higher levels of religiosity tend to experience enhanced satisfaction and are more likely to demonstrate loyalty to Sharia banks, as religiosity positively influences both satisfaction and loyalty outcomes. Perceived value in Islamic banking encompasses both material and moral dimensions. Unlike conventional financial products, which emphasize financial returns and efficiency, Islamic financial products must also offer ethical and religious value. Customers assess not only the cost-benefit ratio of Islamic financing but also whether these products align with Islamic ethics and promote social justice. Amin and Isa (2008) emphasize that perceived value in Islamic finance is multidimensional, incorporating functional, emotional, and spiritual aspects, all of which contribute to overall satisfaction.

Based on the integration of these concepts, this study proposes a conceptual framework to investigate customer satisfaction with Islamic financing services in Melaka. The independent variables identified are Shariah compliance, service quality, transparency, customer trust, and product accessibility. These variables are expected to have a direct impact on the dependent variable, customer satisfaction. In addition, religiosity is introduced as a moderating variable, which may strengthen or weaken the relationship between these independent variables and customer satisfaction.  The proposed framework assumes that when customers perceive Islamic financing products to be consistent with their religious values and expectations of ethical service, their satisfaction is likely to increase. Furthermore, the framework recognizes that religiosity can amplify the influence of factors like Shariah compliance and trust, particularly among customers who are deeply committed to Islamic principles. In the context of Melaka, a culturally diverse yet predominantly Muslim state; this conceptual model provides a localized lens through which Islamic banking institutions can better understand and meet customer expectations.  By addressing key gaps in existing literature such as the lack of regional studies and the limited integration of religiosity as a moderator, this framework contributes both theoretically and practically to the field of Islamic finance. It offers a foundation for future empirical studies and provides actionable insights for financial institutions seeking to enhance customer satisfaction through Shariah-compliant, customer-centric services in Malaysia.

Theoretical and Conceptual Framework

Ajzen’s Theory of Planned Behavior (TPB) and SERVQUAL Model of Service Quality

This study is primarily grounded in two theoretical perspectives: Ajzen’s Theory of Planned Behavior (TPB) and SERVQUAL Model of Service Quality, enriched by Islamic finance principles. Theory of Planned Behavior (Ajzen, 1991) posits that an individual’s behavioral intentions are influenced by attitudes, subjective norms, and perceived behavioral control. In the context of Islamic financing services, religiosity serves as a key attitudinal factor that shapes customers’ preferences and satisfaction levels. Highly religious individuals are more likely to prefer and remain loyal to Shariah-compliant financial products, making religiosity a crucial moderating factor in this study. TPB helps explain why customers’ religious commitment affects their evaluation and acceptance of Islamic financing services beyond conventional economic considerations. SERVQUAL Model (Parasuraman, Zeithaml, & Berry, 1988) is widely used to assess service quality across various sectors, including banking. The model’s five dimensions which are tangibility, reliability, responsiveness, assurance, and empathy offer a comprehensive lens for evaluating customer perceptions of service excellence. In Islamic finance, these dimensions are adapted to reflect cultural and religious expectations, such as amanah (trustworthiness) and ihsan (ethical excellence) (Kashif et al., 2016). The SERVQUAL model informs the study’s independent variables related to service quality and customer trust.  In addition to these, Islamic finance principles, particularly Shariah compliance form the ethical foundation of the framework. Shariah compliance extends beyond legal adherence, encompassing moral and social dimensions crucial to customer trust and satisfaction (Dusuki & Abdullah, 2007). Together, these theoretical perspectives capture both the behavioral and service quality factors influencing customer satisfaction with Islamic financing services.

Conceptual Model

The proposed conceptual framework integrates the above theories and outlines the relationships among key variables as follows:  Independent Variables:  Shariah Compliance (ethical/religious adherence of the financing product)  Service Quality (responsiveness, assurance, empathy, tangibility, reliability)  Transparency (clarity and openness in product terms)  Customer Trust (belief in the bank’s integrity and religious commitment)  Product Accessibility (ease of access to Islamic financing products)  Dependent Variable:  Customer Satisfaction (overall contentment with Islamic financing services)  Moderating Variable:  Religiosity (degree of religious commitment influencing perceptions and evaluations). The model hypothesizes that higher levels of perceived Shariah compliance, service quality, transparency, trust, and accessibility positively influence customer satisfaction. Religiosity is expected to moderate these relationships, intensifying the effects of Shariah compliance and trust on satisfaction.

iii. Justification and Interrelationships of Theories 

The selection of Ajzen’s TPB is justified as it provides a robust explanation for how religiosity, an internal attitudinal factor influences consumer behavior in Islamic finance. It highlights the motivational role of religious beliefs in shaping customer preferences and satisfaction, which traditional service quality models may overlook.  The SERVQUAL model is chosen due to its comprehensive approach to evaluating service quality, a direct antecedent of customer satisfaction. When adapted for Islamic banking, it effectively captures service expectations unique to the cultural and religious context, including ethical behavior and personalized care.  Integrating Islamic finance principles especially Shariah compliance provides the ethical and religious context indispensable for understanding customer satisfaction in Islamic financing services. This integration bridges the gap between behavioral theories and service quality frameworks by emphasizing the moral dimension critical to Islamic finance customers.  Interrelationships in the framework suggest that while service quality and transparency build trust and satisfaction, Shariah compliance adds a unique layer of ethical legitimacy that is especially important to religiously committed customers. Religiosity amplifies these relationships by strengthening customers’ sensitivity to compliance and trust factors, making their satisfaction more contingent upon perceived adherence to Islamic principles.  In sum, the framework captures the multidimensional nature of customer satisfaction in Islamic finance, combining behavioral intention, service quality, and religious ethics to provide a holistic understanding suitable for the Melaka context.

Future Work and Conclusion

The proposed conceptual framework offers significant contributions to the theoretical understanding of customer satisfaction in the context of Islamic financing services, particularly within the Melaka region. By integrating established theories such as Ajzen’s (1991) Theory of Planned Behavior (TPB) and the SERVQUAL model of service quality (Parasuraman, Zeithaml, & Berry, 1988), alongside core Islamic finance principles such as Shariah compliance, the framework provides a nuanced, multidimensional lens through which customer satisfaction can be studied. This integration extends existing knowledge by emphasizing the role of religiosity as a moderating factor, reflecting the unique sociocultural and religious dynamics influencing consumer behavior in Islamic banking (Dusuki & Abdullah, 2007).  In a similar vein, Rosula et al. (2024) demonstrate that nisbah perception moderates the relationship between religiosity commitment and customer loyalty, illustrating how sociocultural and religious dynamics influence consumer behavior in Sharia banking. One of the key theoretical contributions of the framework lies in its recognition that customer satisfaction with Islamic financing is not merely a function of conventional service quality or financial performance but is deeply intertwined with ethical and religious considerations. While prior research has extensively documented the importance of service quality in shaping customer satisfaction (Kashif, Abdur Rehman, & Pileliene, 2016), this framework advances the discourse by explicitly incorporating Shariah compliance and religiosity. These dimensions align with Haniffa and Hudaib’s (2007) findings that trust in Islamic financial institutions is heavily predicated on perceptions of ethical adherence and religious authenticity. Thus, the framework enriches theoretical models by contextualizing customer satisfaction within the ethical-religious paradigm that governs Islamic finance.

Moreover, the inclusion of transparency and product accessibility as independent variables addresses contemporary calls in the literature for more comprehensive models that reflect evolving customer expectations (Amin & Isa, 2008). Transparency facilitates informed decision-making and mitigates information asymmetry, which is critical in financial products with complex contractual structures like Islamic financing. Product accessibility, meanwhile, acknowledges the practical barriers customers may face, highlighting the importance of convenience and availability in fostering satisfaction. Together, these variables broaden the conceptual scope, allowing for a more holistic understanding of the factors influencing customer satisfaction in Islamic finance.

Despite these strengths, the framework has inherent limitations that must be acknowledged. Being conceptual, it lacks empirical validation, which limits its predictive power and generalizability. The specific sociocultural context of Melaka, with its unique demographic and religious composition, may constrain the applicability of the model in other regions or countries with different Islamic banking landscapes. Additionally, while religiosity is posited as a moderator, the framework does not fully explore potential interactions between other variables, such as how transparency might influence trust or service quality perceptions. Future empirical studies could address these gaps by testing the model’s constructs and refining inter-variable relationships based on data-driven insights.

The practical implications of this framework are considerable for Islamic financial institutions operating in Melaka and similar markets. Understanding that customer satisfaction extends beyond service delivery to include religious and ethical compliance can guide banks in designing financing products and services that resonate with their customers’ values and expectations. Enhancing transparency and accessibility can further improve customer perceptions and loyalty, ultimately leading to stronger competitive advantages in a growing Islamic finance market. Financial institutions can also leverage the moderating effect of religiosity to segment customers and tailor marketing strategies, focusing efforts on more religiously committed segments that are likely to value Shariah compliance and trustworthiness more intensely. In conclusion, this conceptual framework contributes to both theory and practice by offering an integrated approach that captures the complex interplay between service quality, ethical compliance, and religiosity in shaping customer satisfaction with Islamic financing services. While requiring empirical testing and contextual refinement, it lays a foundation for future research and offers actionable insights for Islamic financial institutions aiming to enhance customer satisfaction in Melaka and beyond.

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