HINDRANCES OF INTEREST FREE BANKING ADOPTION IN ETHIOPIAN BANKING INDUSTRY AND ITS CUSTOMER’S INTENT

The purpose of this study is to determine the barriers to interest-free banking acceptance, usage, and consumer satisfaction in the Ethiopian banking system, with a focus on commercial banks. To meet the study's goal, primary data were acquired from managers of a few chosen commercial banks via unstructured interviews and from clients via conventional questionnaires. Secondary data was gathered from bank papers and journals to supplement the responses gained from main data sources. The data was examined using descriptive and inferential methods. Economic variables such as unemployment and saving habits are influencing banks' adoption of interest-free financial goods and services, according to the study. Furthermore, technical settings are becoming obsolete, government laws are becoming more rigid, and Other elements influencing financial product acceptance include clients' educational backgrounds and society's different cultures. Furthermore, clients do not adequately use interest-free financial goods and services as a consequence of their lack of awareness, perceived relative benefit, perceived compatibility, perceived complexity, and perceived trust in the present banking system. Based on the findings, it is suggested that banks effectively implement interest-free financial products and services while taking external considerations into account. Furthermore, banks should engage in aggressive marketing to inform clients about their interest-free goods and services, and the government should develop legislation and regulations that reduce the bureaucracy associated with bank technology adoption.

Please see the link :- https://www.ikprress.org/index.php/JET/article/view/5124