Towards a sustainable Islamic digital banking ecosystem: empirical evidence on the impact of trust and Islamic religiosity from Indonesia

Purpose This research aims to investigate the key determinants shaping the adoption of Islamic digital banking in Indonesia and explore strategic factors that may improve the quality of Islamic digital banking services. Design/methodology/approach This study adopts a quantitative approach complemented by descriptive qualitative analysis of open-ended questions. Quantitatively, a modified UTAUT2 model integrating trust and Islamic religiosity was tested using PLS-SEM. Secondly, qualitative responses from open-ended questions were analyzed descriptively through coding and thematic grouping to identify key drivers of Islamic digital banking adoption and areas requiring service improvement. A total of 294 users of Islamic digital banking in Indonesia were surveyed using a purposive sampling method. Findings The results indicate that trust (Tr) has a significant positive effect on behavioral intention (BI) (ß = 0.319, p < 0.001) and use behavior (UB) (ß = 0.155, p = 0.010). Islamic religiosity (IR) positively influences BI (ß = 0.157, p < 0.001) but does not significantly moderate the relationship between behavioral intention and use behavior. In addition, the study identifies 13 key factors driving the adoption of Islamic digital banking and fifteen service aspects requiring improvement from the users’ perspective. Practical implications The findings provide insights for Islamic digital banking service providers to strengthen customer trust and align service offerings with Islamic religiosity values relevant to users. Moreover, enhancing technology-based services and user experience is critical to addressing customers’ evolving needs. Social implications This study highlights the importance of Islamic religiosity in shaping decisions to use Islamic digital banking, providing a foundation for developing more inclusive policies and marketing strategies to promote Islamic financial inclusion in Indonesia. Originality/value This study contributes to the literature by extending the UTAUT2 model through the integration of Tr and IR and by offering new insights into the drivers of Islamic digital banking adoption in Indonesia. This theoretical integration advances the understanding of technology acceptance by contextualizing UTAUT2 within faith-driven financial behavior. In addition, this study adopts a quantitative approach complemented by descriptive qualitative analysis of open-ended responses, providing a more comprehensive understanding of user motivations, perceptions and barriers in the context of Islamic digital banking.