Factors affecting the consumer’s intention to adopt Fintech in Islamic banking in Malaysia

Abstract

Open Banking leverages consumer data to enhance access to and management of financial services. However, its success depends heavily on consumers’ willingness to share data in among the banks and their third-party provider. This study explores the factors influencing consumer acceptance of Open Banking in the context of Islamic banking institutions in Malaysia, where religious and cultural values may shape perceptions of risk and trust differently.

The major findings show that performance expectancy, perceived risk, and trust are significant predictors of consumer acceptance.

Performance expectancy which is the consumers' belief in the usefulness of Open Banking was the strongest driver of acceptance. In contrast, perceived risk negatively impacted acceptance, while trust played a key role in encouraging data-sharing behaviour.

A mixed-methods approach was adopted, starting with interviews with industry experts, followed by regression analysis of survey data from 118 respondents, and further validated using Structural Equation Modelling (SEM) via AMOS with a sample of 341 respondents.

The data was purposefully collected on Malaysian Islamic banks to ensure that the differing approaches to risk and trust within the Muslim community were appropriately understood.

The study concludes that consumer acceptance of Open Banking is shaped by both the perceived benefits of the service and the confidence that data will be managed securely and ethically. Building trust and addressing risk concerns are therefore essential to optimising data use and enhancing consumer participation in Open Banking within Islamic financial systems.