Digital Financial Intuition and AI-Driven Marketing: Enhancing Perceived Fairness to Improve Customer Retention in Malaysian Islamic Banks

Articles in Press

Document Type : Research Paper

Author

Universiti Kebangsaan Malaysia, UKM Bangi,

Abstract

This study examines how Digital Financial Intuition (DFI) and AI-Driven Personalized Marketing (AIPM) influence Customer Retention (CR) in Islamic banks, with Perceived Fairness (PF) as a mediating construct. Drawing on the Technology Acceptance Model (TAM), which emphasizes ease of use and usefulness, and Equity Theory, which highlights fairness in exchange relationships, the framework integrates usability and ethical evaluation in digital Islamic banking. Data were collected through a cross-sectional survey of 254 users of Islamic digital banking services in Malaysia and analyzed using Partial Least Squares Structural Equation Modelling (PLS-SEM). Results show that both DFI and AIPM have significant positive effects on CR, directly and indirectly through PF, which acts as a key psychological mechanism linking digital service experiences to loyalty. These findings extend TAM by introducing intuitive cognition and enrich Equity Theory by demonstrating fairness as a mediating driver of behavioral outcomes in AI-mediated services. The integrated framework provides stronger explanatory power for loyalty than conventional trust- or satisfaction-based models. Practically, Islamic banks should prioritize intuitive, inclusive interfaces and transparent personalization to build long-term trust. Policymakers should also adopt fairness audits and algorithmic transparency guidelines to align digital transformation with Malaysia’s Financial Sector Blueprint.

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Interdisciplinary Journal of Management Studies

Articles in Press, Accepted Manuscript
Available Online from 18 October 2025

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