Do customers' perceptions of Islamic banking services predict satisfaction and word of mouth? Evidence from Islamic banks in Bangladesh

This study aims to investigate the customers' perceptions of Islamic banking services and their impact on satisfaction and word of mouth (WOM) with others. This study designs the bootstrapping procedures using a partial least square method to test path coefficient results. Structured questionnaires were distributed among clients of Islamic banks in Dhaka city, where 377 responses were collected for data analysis. The findings revealed that there is a highly significant relationship between security and customers' perception. Ethical responsibility and religious value have a positive and significant impact on customers' perception whereas benefit has a negative significant impact on customers' perception. Findings from this study also indicated that customers' perceptions mediate the effect of ethical responsibility, religious value, benefit, and security on satisfaction. In addition, customers' satisfaction mediates the effect of customers' perception and WOM. These findings can promote managers of Islamic banks to build customer satisfaction and WOM with Islamic banking services, and attain competitive advantage that may lead Islamic banks to succeed in the competitive business. This study also provides new insights into customers' WOM with others about Islamic banking services. This knowledge could assist Islamic banks to understand the customers' perceptions that would increase satisfaction and in turn, contribute to WOM with others in determining where would be best to target marketing attention of Islamic banking services with limited resources.