Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach

Habtamu Alebachew Legass; Dawud Chane Mekonnen; Jundi Mohammed Yusuf

doi:doi:10.11648/j.ijfbr.20251102.11

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Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach

Habtamu Alebachew Legass^*

, Dawud Chane Mekonnen

, Jundi Mohammed Yusuf

Published in International Journal of Finance and Banking Research (Volume 11, Issue 2)

Received: 5 January 2025 Accepted: 3 February 2025 Published: 21 March 2025

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Abstract

This study examines the impact of digitalization on customer satisfaction in Islamic banking in Ethiopia, focusing on central and eastern regions. A sample of 400 participants was surveyed, with 361 valid responses, using a five-point Likert scale. Data analysis, including explanatory factor analysis and regression, was conducted using SPSS 25 and Amos 23. The results indicate that compliance, reliability, service quality, and human skills significantly and positively influence customer satisfaction with digital Islamic banking. The study's limitations include its focus on a single country, which may limit generalizability to other contexts. Future research could explore cross-cultural differences, longitudinal studies, and qualitative methods to gain deeper insights into customer satisfaction in Islamic banking, especially about technology and global crises like cybersecurity concerns, pandemics, and economic instability. The study suggests that Ethiopian Islamic banks can enhance trust and satisfaction by prioritizing Sharia compliance, investing in staff training, transparent communication, and reliable technology. Customers should support institutions that align with their religious values, fostering long-term relationships. This research addresses a critical gap in understanding customer satisfaction with digital banking services, particularly in global crises such as cybersecurity issues, pandemics, and economic instability. It focuses on how customers of full-fledged Islamic banks perceive and evaluate digital services, the impact of cybersecurity on trust and satisfaction, and the influence of cultural and religious values. Moreover, to the researchers' best knowledge, it is the first study in the country to examine this topic in Islamic banks.

Published in	International Journal of Finance and Banking Research (Volume 11, Issue 2)
DOI	10.11648/j.ijfbr.20251102.11
Page(s)	23-36
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2025. Published by Science Publishing Group

Keywords

Digital Banking, Islamic Banks, Service Quality, Customer Satisfaction

References

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Legass, H. A., Mekonnen, D. C., Yusuf, J. M. (2025). Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. International Journal of Finance and Banking Research, 11(2), 23-36. https://doi.org/10.11648/j.ijfbr.20251102.11

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Legass, H. A.; Mekonnen, D. C.; Yusuf, J. M. Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. Int. J. Finance Bank. Res. 2025, 11(2), 23-36. doi: 10.11648/j.ijfbr.20251102.11

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Legass HA, Mekonnen DC, Yusuf JM. Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. Int J Finance Bank Res. 2025;11(2):23-36. doi: 10.11648/j.ijfbr.20251102.11

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@article{10.11648/j.ijfbr.20251102.11,
  author = {Habtamu Alebachew Legass and Dawud Chane Mekonnen and Jundi Mohammed Yusuf},
  title = {Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach
},
  journal = {International Journal of Finance and Banking Research},
  volume = {11},
  number = {2},
  pages = {23-36},
  doi = {10.11648/j.ijfbr.20251102.11},
  url = {https://doi.org/10.11648/j.ijfbr.20251102.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20251102.11},
  abstract = {This study examines the impact of digitalization on customer satisfaction in Islamic banking in Ethiopia, focusing on central and eastern regions. A sample of 400 participants was surveyed, with 361 valid responses, using a five-point Likert scale. Data analysis, including explanatory factor analysis and regression, was conducted using SPSS 25 and Amos 23. The results indicate that compliance, reliability, service quality, and human skills significantly and positively influence customer satisfaction with digital Islamic banking. The study's limitations include its focus on a single country, which may limit generalizability to other contexts. Future research could explore cross-cultural differences, longitudinal studies, and qualitative methods to gain deeper insights into customer satisfaction in Islamic banking, especially about technology and global crises like cybersecurity concerns, pandemics, and economic instability. The study suggests that Ethiopian Islamic banks can enhance trust and satisfaction by prioritizing Sharia compliance, investing in staff training, transparent communication, and reliable technology. Customers should support institutions that align with their religious values, fostering long-term relationships. This research addresses a critical gap in understanding customer satisfaction with digital banking services, particularly in global crises such as cybersecurity issues, pandemics, and economic instability. It focuses on how customers of full-fledged Islamic banks perceive and evaluate digital services, the impact of cybersecurity on trust and satisfaction, and the influence of cultural and religious values. Moreover, to the researchers' best knowledge, it is the first study in the country to examine this topic in Islamic banks.
},
 year = {2025}
}

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SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20251102.11
AB  - This study examines the impact of digitalization on customer satisfaction in Islamic banking in Ethiopia, focusing on central and eastern regions. A sample of 400 participants was surveyed, with 361 valid responses, using a five-point Likert scale. Data analysis, including explanatory factor analysis and regression, was conducted using SPSS 25 and Amos 23. The results indicate that compliance, reliability, service quality, and human skills significantly and positively influence customer satisfaction with digital Islamic banking. The study's limitations include its focus on a single country, which may limit generalizability to other contexts. Future research could explore cross-cultural differences, longitudinal studies, and qualitative methods to gain deeper insights into customer satisfaction in Islamic banking, especially about technology and global crises like cybersecurity concerns, pandemics, and economic instability. The study suggests that Ethiopian Islamic banks can enhance trust and satisfaction by prioritizing Sharia compliance, investing in staff training, transparent communication, and reliable technology. Customers should support institutions that align with their religious values, fostering long-term relationships. This research addresses a critical gap in understanding customer satisfaction with digital banking services, particularly in global crises such as cybersecurity issues, pandemics, and economic instability. It focuses on how customers of full-fledged Islamic banks perceive and evaluate digital services, the impact of cybersecurity on trust and satisfaction, and the influence of cultural and religious values. Moreover, to the researchers' best knowledge, it is the first study in the country to examine this topic in Islamic banks.

VL  - 11
IS  - 2
ER  -

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Author Information

Habtamu Alebachew Legass

Research Center of Islamic Economics and Finance, Sakarya University, Sakarya, Türkiye

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http://orcid.org/0000-0002-7127-1719
Dawud Chane Mekonnen

Department of Public Administration and Development Management, Dire Dawa University, Dire Dawa, Ethiopia

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http://orcid.org/0009-0006-6294-4711
Jundi Mohammed Yusuf

Department of Accounting and Finance, Dire Dawa University, Dire Dawa, Ethiopia

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APA Style

Legass, H. A., Mekonnen, D. C., Yusuf, J. M. (2025). Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. International Journal of Finance and Banking Research, 11(2), 23-36. https://doi.org/10.11648/j.ijfbr.20251102.11

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ACS Style

Legass, H. A.; Mekonnen, D. C.; Yusuf, J. M. Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. Int. J. Finance Bank. Res. 2025, 11(2), 23-36. doi: 10.11648/j.ijfbr.20251102.11

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AMA Style

Legass HA, Mekonnen DC, Yusuf JM. Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach. Int J Finance Bank Res. 2025;11(2):23-36. doi: 10.11648/j.ijfbr.20251102.11

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@article{10.11648/j.ijfbr.20251102.11,
  author = {Habtamu Alebachew Legass and Dawud Chane Mekonnen and Jundi Mohammed Yusuf},
  title = {Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach
},
  journal = {International Journal of Finance and Banking Research},
  volume = {11},
  number = {2},
  pages = {23-36},
  doi = {10.11648/j.ijfbr.20251102.11},
  url = {https://doi.org/10.11648/j.ijfbr.20251102.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20251102.11},
  abstract = {This study examines the impact of digitalization on customer satisfaction in Islamic banking in Ethiopia, focusing on central and eastern regions. A sample of 400 participants was surveyed, with 361 valid responses, using a five-point Likert scale. Data analysis, including explanatory factor analysis and regression, was conducted using SPSS 25 and Amos 23. The results indicate that compliance, reliability, service quality, and human skills significantly and positively influence customer satisfaction with digital Islamic banking. The study's limitations include its focus on a single country, which may limit generalizability to other contexts. Future research could explore cross-cultural differences, longitudinal studies, and qualitative methods to gain deeper insights into customer satisfaction in Islamic banking, especially about technology and global crises like cybersecurity concerns, pandemics, and economic instability. The study suggests that Ethiopian Islamic banks can enhance trust and satisfaction by prioritizing Sharia compliance, investing in staff training, transparent communication, and reliable technology. Customers should support institutions that align with their religious values, fostering long-term relationships. This research addresses a critical gap in understanding customer satisfaction with digital banking services, particularly in global crises such as cybersecurity issues, pandemics, and economic instability. It focuses on how customers of full-fledged Islamic banks perceive and evaluate digital services, the impact of cybersecurity on trust and satisfaction, and the influence of cultural and religious values. Moreover, to the researchers' best knowledge, it is the first study in the country to examine this topic in Islamic banks.
},
 year = {2025}
}

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TY  - JOUR
T1  - Islamic Banking Customers Satisfaction in the Digital Banking: Evidence from Ethiopia: A SEM Approach

AU  - Habtamu Alebachew Legass
AU  - Dawud Chane Mekonnen
AU  - Jundi Mohammed Yusuf
Y1  - 2025/03/21
PY  - 2025
N1  - https://doi.org/10.11648/j.ijfbr.20251102.11
DO  - 10.11648/j.ijfbr.20251102.11
T2  - International Journal of Finance and Banking Research
JF  - International Journal of Finance and Banking Research
JO  - International Journal of Finance and Banking Research
SP  - 23
EP  - 36
PB  - Science Publishing Group
SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20251102.11
AB  - This study examines the impact of digitalization on customer satisfaction in Islamic banking in Ethiopia, focusing on central and eastern regions. A sample of 400 participants was surveyed, with 361 valid responses, using a five-point Likert scale. Data analysis, including explanatory factor analysis and regression, was conducted using SPSS 25 and Amos 23. The results indicate that compliance, reliability, service quality, and human skills significantly and positively influence customer satisfaction with digital Islamic banking. The study's limitations include its focus on a single country, which may limit generalizability to other contexts. Future research could explore cross-cultural differences, longitudinal studies, and qualitative methods to gain deeper insights into customer satisfaction in Islamic banking, especially about technology and global crises like cybersecurity concerns, pandemics, and economic instability. The study suggests that Ethiopian Islamic banks can enhance trust and satisfaction by prioritizing Sharia compliance, investing in staff training, transparent communication, and reliable technology. Customers should support institutions that align with their religious values, fostering long-term relationships. This research addresses a critical gap in understanding customer satisfaction with digital banking services, particularly in global crises such as cybersecurity issues, pandemics, and economic instability. It focuses on how customers of full-fledged Islamic banks perceive and evaluate digital services, the impact of cybersecurity on trust and satisfaction, and the influence of cultural and religious values. Moreover, to the researchers' best knowledge, it is the first study in the country to examine this topic in Islamic banks.

VL  - 11
IS  - 2
ER  -

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