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Islamic personal financing (IPF) is an emerging phenomenon though less investigated area in Islamic finance. IPF, which the Islamic banks offer according to the needs of their customers, has been overlooked especially using a comprehensive model(s) in most of the developing Islamic countries. This study closes the gap and examines the factors (i.e., attitude, government support, social influence, pricing, and awareness) that determine the acceptance of Islamic personal financing in Khyber Pakhtunkhwa (KP) province, Pakistan. Relying on the survey, the study used a sample of Islamic banks’ customers who were studying or doing a job in higher education institutions. The data were collected through a survey by distributing 600 questionnaires out of which 360 valid responses were used for further analysis. For analyzing the data, the Smart-PLS was used with structural equation modeling to get results of the hypothesized relationships. Results of the present study reveal that social influence, attitude, government support, and awareness have positive and significant effects while pricing has a negative but significant impact on the acceptance of IPF. The findings of this study can be used as a tool for making better policies and right practices of Islamic banks thereby enhancing the IPF in Pakistan.

Sana Ullah Khan, Ikram Ullah Khan, Muhammad Haroon Khan, Safeer Ullah Khan. (2019) Analyzing the acceptance of Islamic personal financing using extended TRA model: Evidence from Khyber Pakhtunkhwa, Pakistan, Abasyn Journal of Social Sciences, Volume-12, Issue-2.
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