Chapter 4

Data Integration and Analysis

Reliability test:
Before hypothesis testing through binary logistic regression it is important to
check the reliability of the constructs. Cronbach alpha is the reliability measure, it
should be at least 0.6. The table given below shows the overall reliability of the
questionnaire.

Reliability Statistics
Cronbach's
Alpha
N of Items
.866
13
It shows the number of questions in the questionnaire which is thirteen and Cronbach alpha value
0.866.The data is reliable because the Cronbach alpha is more than 0.6.

Hypothesis Testing:
Variables in the Equation
B
Step 1a

S.E.

Wald

df

Sig.

Exp(B)

awareness

.113

.401

.079

.778

1.120

Product and service

.939

.480

3.824

.051

2.557

-.101

.299

.115

.734

.904

.180

.304

.351

.553

1.197

-1.999

1.160

2.971

.085

.135

Religious
Friends and family
Constant

a. Variable(s) entered on step 1: awareness, product and service, religious, friends and family.

We tested the relationship between dependent variable which is preference towards Islamic
banking and four independent variable namely: awareness towards Islamic banking, friends and
family influence, religious factor and the quality of banks product and service by applying
binary logistic regression. The results are shown above. The level of significance is 5%.
H1: Quality of product and service has a positive effect on customers preference for Islamic
banking.
Quality of product and service has the P value of 0.051 which is equals to 5% significance level,
thus we failed to reject the null hypothesis and concluded that, quality of product and services
about Islamic banking has a positive effect on customers selection. The beta value 0.939 shows
that if product and service quality will increase by 1% then preference of customers towards
Islamic banking will increase by 0.939%

H2: Riba factor is the main reason for the customers to switch towards Islamic Banking.
The table shows that the religious factor has P value of 0.734 which is greater than 5 significance
level %, thus we will reject the null hypothesis and concluded that, Riba factor is not the main
reason for the customer to switch towards Islamic banking. The beta value -0.101 shows that if
riba factor will increase by 1% then customers switching towards Islamic banking will decrease
by 0.101%.
H3: Awareness about Islamic Banking has a positive effect on customers selection.
The P value 0.778 in the table is greater than 5% significance level, thus we will reject the null
hypothesis and concluded that, Awareness about Islamic banking does not have a positive effect
on customers selection. The beta value 0.113 shows that if awareness will increase by 1% then
preference of customers will increase by 0.113.
H4: Reviews of friends and family will have positive effect on customers choice.
The P value 0.553 in the table is greater than 5% significance level, thus we will reject the null
hypothesis and concluded that, reviews of friends and family does not have a positive effect on
customers selection. The beta value 0.180 shows that if reviews of friends and family will
increase by 1% then customers preference will increase by 0.180.
Interpretation of Exp (B)
variable
Product and service

S.E.

Wald

df

Sig.

Exp(B)

.939

.480

3.824

.051

2.557

The value of Exp (B) shows that customers will prefer 2.5 times more to those banks who have
good product and service quality.