DETERMINANTS OF CLIENTS DEMAND TO USE ISLAMIC BANKING SERVICE IN SILTE ZONE, ETHIOPIA

ABSTRACT<br> The main objective of the study was to examine determinants of demand to use Islamic banking products in Ethiopia. To achieve this objective, explanatory research designs were employed, and the researcher exercised descriptive and inferential statics to analysis collected primary data from probabilistic multiple-stage sampled of 385 households, who were individuals whose age was above 18 years in Silte zone. After a descriptive analysis the researcher was employed binary logit regression model. The empirical result show that, Gender, Absence of some type of IB product, Distance, Religion, and Confusion b/n IFW &amp; IB difference had statistically significantly and negative associate with consumption of Islamic banking products, whereas Educational status, Level of income, Religiosity, and Islamic finance literacy had statistically significant positive association to consumption of Islamic banking products. Based on finding the researcher was recommended that, the Islamic banking institution is advised to provide training in Islamic financial literacy, especially by creating awareness about Islamic banking service, and try to make clarity between the difference between interest free window of conventional bank and fully fledged Islamic bank. Furthermore Islamic banking institution should focus on accessibility of the institution by the number of branch.<br>