Toward new strategies of Islamic financial products development
Journal of Islamic Accounting and Business Research
ISSN: 1759-0817
Article publication date: 17 October 2020
Issue publication date: 6 December 2020
Abstract
Purpose
This paper aims to propose a conceptual framework for the assessment of Islamic financial products’ development.
Design/methodology/approach
A coordinate grid with two perpendicular axes (profitability and compliance to Shari’ah) is developed and used to produce a nine-zone matrix. The research design is further developed by using a linear, composite index to assess product development feasibility and specifications. Subsequently, three strategic paths are identified: profitability-led strategic path, compliance-led strategic path and intermediate strategic path.
Findings
The findings indicate that the ideal strategic behavior the Islamic financial institutions have to borrow corresponds to the intermediate strategic path because it optimizes the trade-off between the two attributes under consideration. A proper development strategy of Islamic financial products should not ignore the compliance to the substance of Shari’ah and combine it simultaneously with profitability.
Originality/value
The paper’s originality consists in the identification of the portfolio of Islamic financial products’ strategic positioning in the nine-zone matrix and the determination of the most suitable product development strategy.
Keywords
Citation
Mansour, W. (2020), "Toward new strategies of Islamic financial products development", Journal of Islamic Accounting and Business Research, Vol. 11 No. 10, pp. 2053-2067. https://doi.org/10.1108/JIABR-09-2018-0135
Publisher
:Emerald Publishing Limited
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