Does Prohibition of Usury Influence Behavior of Bank Customers in Indonesia?

Hariadi, Sugeng (2014) Does Prohibition of Usury Influence Behavior of Bank Customers in Indonesia? In: The 3rd International Conference on Business and Banking, Dusi Thani Pattaya, Thailand, February 5-7, 2014. STIE Perbanas Surabaya & Sripatum University Chonburi, Surabaya . ISBN 978-602-96319-3-7

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Abstract

Islamic banks actually have tremendous market potential in Indonesia, especially after the prohibition of usury was issued by the Indonesian Ulema Council (MUI) in 2004. However, growth in market share of Islamic banks is always lower than the expected target. This study analyzes the influence of usury laws on the behavior of bank customers in Indonesia, especially on the decision making as an economic agent. Descriptive statistics analysis tools used to discover and explain the behavior of bank customers when choosing a bank, in the face of rising interest rates with other banks, and when informed prohibition of bank interest (usury). Questionnaires were distributed to 141 respondents. It was found that customers still choose conventional banks. The choice of a bank based on the factors: the confidentiality of customer data is in a bank, a fast and efficient service, and facilities on line between branches. The provision of feedback of information (about the rise in interest rates at other banks) divides customers into two groups: loyal and disloyal customers. Information of interest prohibition has significantly lowered the amount of desire on the interest rate, to be at a normal rate of return. There is still a customer credit and other banking services are interesting to study.

Item Type: Book Section
Uncontrolled Keywords: Islamic bank, usury, consumer behavior, normal rate of return.
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Business and Economic > Department of Economic
Depositing User: Eko Setiawan 194014
Date Deposited: 21 Feb 2014 03:19
Last Modified: 25 Feb 2014 02:38
URI: http://repository.ubaya.ac.id/id/eprint/7973

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