Effect of islamic banks on financial deepening amongst Kenyan muslims

Abstract

This study sought to establish the effects of Islamic banks on financial deepening amongst Kenyan Muslims. This research adopted a descriptive research design where the population of interest in the Islamic field was visited. The target population for this study was the Muslims. The researcher intends to examine a sample of 384 Muslims drawn from the population of over 100,000. The researcher used a questionnaire as the primary data collection instrument. Content analysis and descriptive analysis were employed. Regression model was also used to establish the relationship between the variables. he study established that lack of access to financial information service affected the growth of Islamic banking. Lack of managerial training and experience affect the growth of small and medium financial institutions. The study identified that government policies and regulations affect the growth of small financial institutions. The study established that technological changes affect the growth of the financial institutions. The customers encounter problems of raising capital, accessing finance and accessing credit. The study recommends that there should be increased support for learning visits to improve the information flow, the government should come up with policies on training of business owners and managers especially on directing, staffing, deployment of finance resources and controlling activities, the government should seek to address the pertinent issues like complex licensing regime that has impeded economic development Islamic banking system in the country. The government should intercede in solving the problems of unawareness of new technology, unfamiliarity with new technologies and the new technology not being affordable by maybe subsidizing on the cost of adoption. The financial institutions should also adjust their tight regulations and credit policies and the means of determining the creditworthiness of their customers and the credit appraisal.