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

Document Type : Research Paper

Author

Faculty of Economics and Management, Universiti Kebangsaan Malaysia, Selangor, Malaysia

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 analysed 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 behavioural 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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References

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Interdisciplinary Journal of Management Studies
Volume 19, Issue 3
July 2026
Pages 583-607

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