Perception of SME Management Regarding Islamic Banking: A Users vs. Non-users Comparative Analysis


  • Rabia Umar Bahria University, Islamabad
  • Faid Gul National University of Modern Languages, Islamabad



SMEs, customer perception, Islamic banking, awareness, Shariah compliance, service quality


Small and medium enterprises (SMEs) are playing a vital role in the Pakistani economy but they are facing a major constraint of lack of finance. The financial instruments being offered by Islamic banks can better meet the financial needs of SMEs but investment in Pakistani SMEs sector is not very high. The current study investigates the difference in perceptions among users and non-users of Islamic banking instruments in Pakistani SMEs sector. This is a primary data based study and its sample size comprises of 110 entrepreneurs of SMEs in the twin cities of Pakistan i.e. Rawalpindi and Islamabad. The study has used independent sample t-test for comparing the difference in the mean values of users and non-users of the Islamic banking products to test the hypotheses of the study. The results of the study show that there is a significant difference in perception among SMEs regarding Shariah compliance by Islamic banks, service quality, business development service and level of awareness regarding Islamic banking instruments due to which Islamic banking is not commonly used by Pakistani’s SMEs. This study is helpful to the top management of Islamic banks to devise strategies to clarify the misperception of non-users SMEs management regarding Islamic banking products.


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How to Cite

Umar, R., & Gul, F. (2019). Perception of SME Management Regarding Islamic Banking: A Users vs. Non-users Comparative Analysis. JISR Management and Social Sciences & Economics, 17(1), 41–52.



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