Shifting landscape of customer preferences: analyzing internet Islamic banking satisfaction during COVID-19

Abstract

With an increasing number of customers relying on Islamic internet banking services, there is an urgent need to examine their satisfaction levels. Therefore, this study aims to analyze how internet banking services quality impacts customer satisfaction in major Islamic countries during the COVID-19 pandemic. A survey was conducted from March 2022 to April 2023 to gather data from clients, covering a variety of income levels, gender, age and educational backgrounds. 6961 questionnaires were analyzed using the SERVQUAL model and probit ordered model for empirical analysis. Both the SERVQUAL model and probit ordered model analysis yielded consistent findings indicating that reliability, response, online service quality, complaint aspects negatively influence customer satisfaction. Furthermore, the study found that factors such as efficiency and empathy contribute positively to customer satisfaction in the context of internet banking services during the COVID-19 pandemic. By understanding the factors that negatively impact customer satisfaction and usage of internet banking services, Islamic bank management can prioritize investments in security, website attributes, privacy, efficiency, responsiveness, fulfillment, and reliability. This proactive approach not only fosters customer loyalty but also strengthens the competitive position of the bank in the digital banking landscape. Furthermore, insights gained from the study can guide policy adjustments and operational improvements tailored to meet the evolving needs and expectations of customers in the internet banking sector.

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