The role of ar-rahn in enhancing financial inclusion : a structural equation modeling approach

• Main Authors: Azila Abdul Razak, Fidlizan Muhammad, Mohd Yahya Mohd Hussin, Zuraidah Zainol, Fatimah Salwa Abd. Hadi
• Format: Article
• Language: English
• Published: Penerbit Universiti Kebangsaan Malaysia 2017
• Online Access: http://journalarticle.ukm.my/20757/1/14279-65503-1-PB.pdf; http://journalarticle.ukm.my/20757/; https://ejournal.ukm.my/pengurusan/issue/view/1026
• Institution: Universiti Kebangsaan Malaysia

This study examines the relationship between financial inclusion and the adoption of ar-rahn financing in enhancing the well-being of its customers throughout Malaysia. Data distributed via questionnaire to 239 respondents were analyzed using descriptive and structural equation modeling. The results indicate that there is a positive relationship between financial inclusion and ar-rahn’s financing adoption. In addition, the adoption of ar-rahn among customers improves the well-being of individuals and society. This paper contributes to the existing literatures and provide new insights on how financial inclusion could increase the adoption of ar-rahn financing and consequently the individual and societal well-being.