Dubai: Islamic banking has found more takers in UAE since the beginning of the pandemic amid growing consumer awareness and better digital services.
According to Emirates Islamic's survey, Islamic banking’s popularity had grown to 60 per cent in 2021, from 47 per cent in 2015. Meanwhile, conventional banking has been on a downward trend, dropping to 61 per cent this year, from 70 per cent in 2015.
• 61 per cent of the surveyed customers say they have a conventional product compared to 60 per cent who have an Islamic product.
• Islamic banking has grown in popularity in the UAE since 2015 –47 per cent in 2015 to 60 per cent in 2021, while conventional banking is on a downward trend in the same period –70 per cent to 61 per cent.
According to the bank, nearly half of those surveyed under its study said they preferred Islamic banks more since the onset of the pandemic, up from 45 per cent from in 2020.
“For the first time since we launched the Index in 2015, we see a closing of the gap between the adoption of Islamic and conventional banking products,” said Wasim Saifi, Deputy CEO-Consumer Banking and Wealth Management at Emirates Islamic.
“It is clear that consumers are increasingly choosing Shariah compliant solutions when it comes to financing and saving,” said Safi. “This bodes well for Islamic banks as they continue to be considered more financially sound, trustworthy and supportive of their communities than conventional banks”
Around 35 per cent of the total respondents also stated that awareness of Islamic banking terms influences their decision to a large extent. Better digital technology has also emerged as a key decider for consumers to shift to Islamic banking, with preference for such services increasing from 16 per cent in 2020 to 21 per cent in 2021.
As the shift to digital banking continues to grow, we can confidently say that the shift to online and mobile banking is indeed permanent
“It is clear that this is an area that needs to be strengthened much more if Islamic banking wants to outpace conventional banking’s growth and grow beyond borders,” said Al Mulla. “Customer experience is another area that needs to be prioritised to expand Islamic banking’s base and truly close the adoption gap”