Understanding Demand for Sharia-Compliant Loans : Results of a Randomized Experiment in Jordan
The evidence on demand for sharia-compliant financial services is mixed. On the one hand, IFC-funded studies showed relatively high demand, while results from Findex showed that financial exclusion due to religious reasons was minimal (Demirguc-Kun...
| Main Authors: | , , , |
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| Format: | Brief |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2016/06/26430468/understanding-demand-sharia-compliant-loans-results-randomized-experiment-jordan http://hdl.handle.net/10986/24569 |
| Summary: | The evidence on demand for
sharia-compliant financial services is mixed. On the one
hand, IFC-funded studies showed relatively high demand,
while results from Findex showed that financial exclusion
due to religious reasons was minimal (Demirguc-Kunt,
Klapper, and Randall 2013). One of the reasons behind these
contradictory messages could be the survey instruments
themselves: perhaps the issue is not so much what people
want but how they were asked. For example, if you ask
participants why they do not use borrowing or savings
products, their responses may include ‘they are too
expensive’ or ‘they are too far away’ even if the real
reason is something more nuanced, such as intra-household
bargaining issues. Similarly, if you ask Muslims if they
prefer an interest-bearing loan or a noninterest-bearing
loan, it might not be surprising that they would choose the
noninterest-bearing loan, perhaps because they want to
demonstrate piety, or maybe because they assume it means a
no-cost loan. |
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