Islamic Financial Literacy: Evidence from Jordan


  • Demeh Daradkah Yarmouk University, Irbid
  • Ahlam Aldaher Yarmouk University, Irbid
  • Haitham Shinaq Yarmouk University, Irbid



Islamic financial Literacy, Islamic banking services, demographic variables, Jordan


This study aims to test the extent of financial literacy in Islamic banking services in Jordan, and to test the effect of demographic variables: (gender, age, monthly income, region of residence, level of education, field of study, and occupation) on Islamic financial literacy via Ordered Logistic Regression, as well as, testing the differences in Islamic financial literacy among the averages of categories of demographic variables using non-parametric tests.

In order to achieve these goals, the study designed and distributed a questionnaire to a sample of 385 individuals from Jordan. The study found that 19.5% of Jordanians have a low level of Islamic financial literacy, 45.2% and 35.3% of Jordanians have an average and high level of Islamic financial literacy, respectively.

The study found a positive effect of the level of education, region of residence and the field of the study on the level of Islamic financial literacy. In which individuals with a higher educational qualification, “Humanities and Social Science” specialization, and individuals in northern and central Jordan possess a higher level of Islamic financial literacy. On the other hand, the study found a statistically significant difference between the averages of the categories: educational level, field of study, and region of residence.

Therefore, the study recommended the Central Bank of Jordan and the legislators to increase the general level of financial literacy and Islamic financial literacy in particular. Through, targeting segments that showed a low level of Islamic financial literacy. These results also have important implications for policy makers and academics.


Download data is not yet available.

Author Biographies

Demeh Daradkah, Yarmouk University, Irbid

Department of Banking and Finance, Faculty of Economics
and Administrative Sciences

Ahlam Aldaher, Yarmouk University, Irbid

Department of Banking and Finance, Faculty of Economics
and Administrative Sciences

Haitham Shinaq, Yarmouk University, Irbid

Department of Banking and Finance, Faculty of Economics
and Administrative Sciences


Abdullah, R., Razak, A. L. H. A., and Ali, U. I. S. S. (2015) Exploratory Research into Islamic financial Literacy in Brunei Darussalam. Faculty of Business and Management Sciences, Universiti Islam Sultan Sharif Ali Brunei Darussalam.

Ahmad, N. and Haron, S. (2002) Perceptions of Malaysian corporate customers towards Islamic banking products and services, International Journal of Islamic Financial Services, 3(4): 13-29.

Ainley, J., Fraillon, J., Schulz, W., and Gebhardt, E. (2016) Conceptualizing and measuring computer and information literacy in cross-national contexts, Applied Measurement in Education, 29(4): 291-309.

Albaity Mohamed and Rahman Mahfuzur (2019). The intention to use Islamic banking: an exploratory study to measure Islamic financial literacy. International Journal of Emerging Markets, 14(5):988-1012.

Al-Tamimi, H.A.H. and Bin Kalli, A.A. (2009). Financial literacy and investment decisions of UAE investors. The Journal of Risk Finance, 10(5): 500-516.

Antara,P.M.,Musa,R.andHassan,F.(2016) Bridging Islamic financial literacy and halal literacy: the way forward in halal ecosystem, Procedia Economics and Finance, 37 :(16) 196-202

Baker, D. W. (2006) The meaning and the measure of health literacy. Journal of general internal medicine, 21(8): 878-883.

Beal, D., and Delpachitra, S. (2003) Financial literacy among Australian university students. Economic Papers: A journal of applied economics and policy, 22(1): 65-78.

Bin Abdullah, M. A., Hamzah, A. A., Azman, N. S., & Khalil, N. (2015) Islamic Financial Literacy: Empirical Study Among Bankers in Kuala Lumpur and Labuan, Journal of Islamic Banking and Finance, 32(4):46-63.

Bunyamin Er, , and Mutlu, M. (2017) Financial inclusion and Islamic finance: A survey of Islamic financial literacy index. Uluslararası İslam Ekonomisi ve Finansı Araştırmaları Dergisi, 3(2).

Callingham, R., and Watson, J. M. (2005) Measuring statistical literacy. Journal of Applied Measurement, 6(1):19-47.

Cleophas, T. J., and Zwinderman, A. H. (2011) Non-parametric tests. Springer Netherlands.

Chen, H., and Volpe, R. P. (1998). An analysis of personal financial literacy among college students. Financial services review, 7(2): 107-128.

Cochran, W. G. (1963) Sampling Techniques, 2/e., New York: John Wiley and Sons, Inc.

Cueva, C. and Rustichini, A. (2015) Is financial instability male-driven? Gender and cognitive skills in experimental asset markets, Journal of Economic Behavior & Organization, 119(9): 330-344.

Department of Statistics (2018).Amman, Jordan.

Gerardi, K., Goette, L. and Meier, S. (2010) Financial Literacy and Subprime Mortgage Delinquency: evidence from a survey matched to administrative data, Working Paper Series 2010(10), 1, Federal Reserve Bank of Atlanta, Atlanta

Gitman Lawrence, Joehnk Michael , Smart Scott , Juchau Roger H. , Ross Donald G. , Wright Sue(2015) Fundamentals of Investing. 3rd edition, Pearson.

Grassa, G. (2012) Islamic Banks’ Income Structure and Risk: Evidence from GCC Countries. Accounting Research Journal, 25(3): 227-241.

Jordanian Banking Association. (2018) Annual Report, Amman, Jordan.

Jäntti, M., Kanbur, R. and Pirttilä, J. (2014) Poverty, development, and behavioral economics, Review of Income and Wealth, 60(1): 1-6.

Karlan, D., Ratan, A.L. and Zinman, J. (2014) Savings by and for the poor: a research review and agenda, Review of Income and Wealth, 60 ( 1): 36-78.

Kim, J. (2001) Financial knowledge and subjective and objective financial well-being. Consumer Interests Annual, 47(1): 1-3.

Kim, J., and Lee, W. (2013) Meanings of criteria and norms: Analyses and comparisons of ICT literacy competencies of middle school students. Computers & Education, 64: 81-94.

Kiss, H.J., Rodriguez-Lara, I. and Rosa-García, A. (2016) Think twice before running! Bank runs and cognitive abilities, Journal of Behavioral and Experimental Economics, 64(4):12-19.

Klapper, L., Lusardi, A., and Van Oudheusden, P. (2015) Financial literacy around the world. Standard & Poor’s Ratings Services Global Financial Literacy Survey. Washington: Standard & Poor’s.

McCullagh, P. (1980) Regression models for ordinal data. Journal of the Royal Statistical Society: Series B (Methodological), 42(2): 109-127.

Noctor, M., Stoney, S., and Stradling, R. (1992) Financial Literacy, a report prepared for the National Westminster Bank. National Foundation for Educational Research, London.

Rahim, S. H. A., Rashid, R. A., and Hamed, A. B. (2016) Islamic financial literacy and its determinants among university students: An exploratory factor analysis. International Journal of Economics and Financial Issues, 6(7S): 32-35.

Rose, Peter S and Hudgins, Sylvia C.(2013) Bank Management and Financial Services. (9th ed.). McGraw-Hill /Irwin Publishing. (BKM).

Rohatgi, A., Scherer, R., and Hatlevik, O. E. (2016) The role of ICT self-efficacy for students’ ICT use and their achievement in a computer and information literacy test. Computers & Education, 102: 103-116.

Roy, D.A. (1991) Islamic Banking. Middle Eastern Studies, 27:427-56.

Schagen, S., and Lines, A. (1996) Financial literacy in adult life: a report to the Natwest Group Charitable Trust (pp. 36-45). NFER.

Servon, L. J., and Kaestner, R. (2008) Consumer financial literacy and the impact of online banking on the financial behavior of lower‐income bank customers. Journal of Consumer Affairs, 42(2): 271-305.

Setyowati, A., Harmadi, H., and Sunarjanto, S. (2018) Islamic financial literacy and personal financial planning: a socio-demographic study. Jurnal Keuangan dan Perbankan, 22(1): 63-72.

Shelby, L. B. (2011) Beyond Cronbach’s alpha: Considering confirmatory factor analysis and segmentation. Human dimensions of wildlife, 16(2): 142-148.

Shen, C.H.,Lin, S.J., Tang, D.P. and Hsiao,Y.J. (2016) The relationship between financial disputes and financial literacy, Pacific-Basin Finance Journal, 36(3):46-65.

Volpe, R. P., Chen, H., and Pavlicko, J. J. (1996) Personal investment literacy among college students: A survey. Financial Practice and Education, 6(2): 86-94.

Walker, S. H., and Duncan, D. B. (1967) Estimation of the probability of an event as a function of several independent variables. Biometrika, 54(1-2): 167-179.

Watson, J., and Callingham, R. (2003) Statistical literacy: A complex hierarchical construct. Statistics Education Research Journal, 2(2): 3-46.

Watson Jane, M. (2006) Statistical Literacy at School, Growth and Goal.

Wecker, C., Kohnle, C., and Fischer, F. (2007) Computer literacy and inquiry learning: When geeks learn less. Journal of computer assisted learning, 23(2):133-144.

Worthington, A. C. (2006) Predicting financial literacy in Australia.

Wolfe-Hayes, M. A. (2010) Financial literacy and education: An environmental scan. The International Information & Library Review, 42(2): 105-110.

World Bank Statistics Data, (2017).

Zaman, Z., Mehmood, B., Aftab, R., Siddique, M. S., and Ameen, Y. (2017) Role of Islamic financial literacy in the adoption of Islamic banking services: An empirical evidence from Lahore, Pakistan. Journal of Islamic Business and Management, 7(2): 230-247.



How to Cite

Daradkah, D., Aldaher, A., & Shinaq, H. (2020). Islamic Financial Literacy: Evidence from Jordan. Journal Transition Studies Review, 27(2), 131-145.