Factors Affecting the Implementation of Interest Free Banking Services: The Case of Commercial Bank of Ethiopia
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Date
2022-06
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Addis Ababa University
Abstract
Purpose -The study examined Factors affecting the implementation of Interest free banking services among customers of Commercial Bank of Ethiopia, Addis Ababa, Ethiopia. The research used explanatory or causal research design in order to evaluate the dependent and independent variables. Population of this study consisted of dedicated branches users of commercial banks of Ethiopia located in different areas of Addis Ababa. Data were collected from 357 respondents by means of structured questionnaires which were distributed to dedicated IFB branches and were filled by IFB customers of commercial bank of Ethiopia. The result showed that from the eight independent variables used in the study, Awareness, Relative advantage, Compatibility, Observability, Religious beliefs, Customer involvement have positive relation and significant on implementation of IFB and on the other hand Complexity and perceived risk have negative effect. The study area was limited to Addis Ababa districts of Commercial Bank of Ethiopia. Thus, the result from the case might not be generalized to customers or other banks and CBE customers out of Addis Ababa. The study recommended that in order to improve the implementation of IFB there should be study‘s which carried out on sample of all banks and all regions of the country to investigate their proper implementation of such service and also there should be an interview to get qualitative measurement and the other one is providing programs, seminars, and training in the area of Interest Free Banking services and products in order to produce experts that serve the sector.
Keywords: Interest Free Banking, Implementation, Dedicated Branches, CBE