Islamic Finance Ethics and Perception of Western Consumers

Abstract

This paper investigates consumers’ perceptions of Islamic finance (IF) in non-Muslim majority markets. Building on research done previously and data from an original survey, the paper carries out a principal descriptive analysis (PDA) to construct the main dimensions on which financial consumer agents diverge. Five key components emerged from the PDA that is interpreted with the help of a survey covering different types of consumers. Furthermore, it explores the perceived association of Islamic financial values with ethical norms in the West. The findings help us understand how IF has been conceptualised by consumers in non-Muslim majority markets. The five components identified shed light on the constructs that have informed the growth of IF as an ethical option in international non-Muslim majority markets. This advocates the view that IF should be characterised by multidimensional drivers in the global financial market, rather than a single component of religious values.