The role of Ar-Rahnu's benefits - Sacrifices exchange towards relationships between customers and islamic financial institutions

• Published in: Pertanika Journal of Social Sciences and Humanities
• Main Author: Mohd Azli R.; Palil M.R.; Mohd Nor S.; Hamid M.A.; Awang Z.
• Format: Article
• Language: English
• Published: Universiti Putra Malaysia 2017
• Online Access: https://www.scopus.com/inward/record.uri?eid=2-s2.0-85047360722&partnerID=40&md5=78d3ff793bb4b830017d11d42f40bb89

The first Ar-Rahnu (Islamic pawn broking) shop was established in Terengganu, Malaysia in 1992. However, the role of exchange between benefits and sacrifices in Ar-Rahnu transaction as a determination of its development has not been given much emphasis in Malaysia. Therefore, this paper explores a new perspective of Ar-Rahnu especially focusing on its benefits and sacrifices. Several studies have highlighted the benefits-sacrifices exchange (BSX) to be the determinant of customer demand. The BSX in Ar- Rahnu transaction proposes a new conceptual framework to investigate the effects of its usage. This paper provides a new insight into these constructs by introducing the Social Exchange Theory (SET). Two hundred and six respondents were selected to answer a set of questionnaires. The Factor Analysis found that the dimension of benefits and sacrifices in Ar-Rahnu is fit to be analysed using SEM using Amos. This paper suggests that BSX in Ar-Rahnu transaction produce a significant effect on the Ar-Rahnu customer-pawnbroker trust and long-Term relationship. © Universiti Putra Malaysia Press.