Awareness of Islamic Banking Products Among Muslims: The Case of Australia

Abstract

The purpose of this study is to analyze Australian Muslims’ awareness of profit-and-loss sharing financial instruments. A sample of 300 Australian Muslims was surveyed. The survey utilized a short questionnaire containing specific questions relating to the willingness of respondents to purchase profit-and-loss sharing Islamic banking products. The results indicate that the majority of the Australian Muslim population sample would be willing to purchase Islamic banking products, but are not properly informed about profit-and-loss sharing instruments. The results further hint towards a lack of understanding of the principles of Islamic finance. This was deduced from the fact that a section of the population stated that they would not be willing to purchase Islamic banking products if credit facilities were not available, or if the banks shared losses as well as profits.

Keywords: Islamic financing, interest-free financing, profit-and-loss sharing, Australia