The Impact of the Islamic Financing and Investment Mode Diversification on Meeting Customers' Financing Needs: An Applied study on the Libyan Islamic Bank– Misrata Branch

Abstract

This study aimed to examine the effect of diversification in financing and investment modes on meeting customers’ financing needs, with an application to the Libyan Islamic Bank, Misrata Branch. The study adopted a descriptive-analytical approach and used a questionnaire as the primary data collection instrument. Data were collected from a random sample of the bank’s customers, with 70 questionnaires distributed and 68 valid questionnaires retrieved for analysis. To analyze the data and test the study hypothesis, SPSS version 29 was employed using descriptive statistics, simple linear regression analysis, and the F-test. The results showed that the level of diversification in financing and investment modes was high, with a mean score of 3.60. Similarly, the level of meeting customers’ financing needs was high, with a mean score of 3.51. The regression model revealed a statistically significant positive effect of diversification in financing and investment modes on meeting customers’ financing needs. The correlation coefficient (R) was 0.744, while the coefficient of determination (R²) was 0.554. Furthermore, the regression model was statistically significant (F = 82.072, p = 0.000), with a regression coefficient (B) of 0.904. These findings indicate that diversification in financing and investment modes constitutes an important factor in enhancing the bank’s ability to meet customers’ financing needs. Accordingly, the study recommends expanding financing alternatives, particularly financing modes based on real assets, and improving the alignment of financing amounts and maturities with the nature of customers’ actual financing needs.