Abstract
The main focus of this study is to examine the relationship between service quality and customers’ perception. The study deployed modified Carter model by introducing two unique dimensions of corporate social responsibility and innovation to examine this relationship. A self-administrated questionnaire based field survey was conducted. The research instrument was designed using eight dimensions of service quality. The content of the questionnaire was adjusted for relevance and friendliness purpose through pilot testing. Data was collected from 155 Bank Islam Brunei Darussalam (BIBD) customers from Muara district of Brunei. The sample data were statistically analyzed through descriptive, Cronbachs’ Alpha, Kaiser–Meyer–Olkin and Bartlett’s test, Pearson correlation test and confirmatory factory analysis (CFA). Pearson test was used to represent significant relationship between service quality and customer perception and CFA test was done to suggest the fitness of proposed Carter model suitability for Brunei’s Islamic banking. Results of the study revealed that service quality and customer perception are significantly related and Carter model is suitable for Islamic banking system in Brunei. Furthermore the study has practical implications for BIBD policy makers and managers to understand customer perception and adjust its service quality according to customer desire.
Highlights
Financial institutions in Brunei Darussalam are facing intense competition due to minimization of expenditures by government, oil and gas companies representing global consequences of lower hydrocarbon prices (IFSI report, 2017)
The present study focuses on exploring relationship between service quality and customer perception of Islamic bank customers in Brunei this study adopts quantitative research methodology using self-administered questionnaire
The duration of holding account with Bank Islam Brunei Darussalam ranges from 1 year to more than 5 years
Summary
Financial institutions in Brunei Darussalam are facing intense competition due to minimization of expenditures by government, oil and gas companies representing global consequences of lower hydrocarbon prices (IFSI report, 2017). According to Baiduri Bank annual report (2015) the limitation of opportunities has resulted in enhanced competition among the banks signifying the survival of the bank with an exceptional and innovative service quality. The emergence and growth of Islamic banking in Brunei has resulted in intense competition between Islamic banks itself and has posed challenges for conventional banking rival. Islamic banks in Brunei have numerous growth opportunities with a Muslim population of 78.8% (DEPD Annual Report, 2016). Islamic banking industry in Brunei is still facing multiple challenges from leading conventional bank (Baiduri Bank) as conventional banks are deep rooted and popular among public to fulfill their needs
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