Islamic banking is an increasingly important factor in the UK financial environment. With Islamic banks entering the industry in significant numbers – and competing directly with the incumbent “conventional” ones – the question of selection criteria of the banks' customers is of obvious interest. The purpose of this paper is to study the decision‐making process of a sample of UK customers and the factors that may influence them.
The paper uses a sample of 156 UK questionnaire respondents, comprising Muslim and non‐Muslim bank customers alike. The methodological approach is partly borrowed from Masood et al. with the chosen questions aimed at finding out what drives the selection process of bank customers.
The paper's major findings show that, irrespective of the demographic features and the religion of the respondents, the criterion “low services charges” is the top customers' criteria. The Islamic nature of the bank is, however, placed second, pointing to the importance of religious orientation.
The major limitation of the paper relates to the size of the sample of respondents. The findings of the paper are likely to be of interest to UK banks determining how best to attract customers in the new era. Future research may usefully focus on an international comparison of bank selection criteria by employing an index of religiosity.
The paper is of particular value because it focuses on the choice of banking in the context of the recent significant growth in the Islamic banking industry in the UK.
