Untapped Market of Islamic Pension Fund: Muslim Attitude and Expectation
in Indonesia

Yunice Karina Tumewang

Islamic University of Indonesia

ArizaAyumardani

Ministry of Law and Human Rights

HadriKusuma

Islamic University of Indonesia

Purpose: As a matter of fact, with more than 1.8 billion Muslims around the world, the global demand for Sharia-compliant pension funds is predicted to reach as high as US$ 190 billion. However, over the last decade, only small portion of this huge potential market has been covered. This study aims to examine the factors of this untapped market.

Design/methodology/approach: This study used quantitative method with primary data through questionnaire distributed to 163 samples of Muslim population in Indonesia. To test the effect of demographic variables, the Pearson correlation coefficients is used to indicate normality and linearity (Bryman & Cramer, 2002). Meanwhile, a series of two-tailed independent group t-tests and Kruskal Wallis test are conducted to confirm the hypotheses.

Main Findings: This study sheds light on Muslim attitudes and expectations toward Sharia-compliant retirement planning and fund. This study suggests government to formulate a supportive regulation which triggers Indonesiaï¿½s Social Security Agency (BPJS) to offer the Sharia-compliant plan.

Applications of this study: The study provides a descriptive picture for the Islamic Financial Institutions regarding Muslim attitude and expectation toward their product and services on Islamic Pension Fund. In addition, this study also helps to raise the awareness of society to see Islamic Pension Fund as a prospective industry in the foreseeable future.

Novelty/Originality: As far as we are concerned, there is only small number of research on analyzing the demand of Islamic Pension Fund, although the potential market is huge and available to be tapped. This work is an attempt to fill in this gap.

Keywords: Islamic Pension Fund, Attitude, Expectation, TPB, Islamic finance

1. BACKGROUND

The number of Muslim is growing rapidly today. Based on Pew Research Center (2017), the number of Muslim is believed to be the best religious group in term of the growth. In decades later, it is projected that there will be an upward trend in the total global population particularly Muslim population. While the number of populations globally is predicted to rise by 32% decades later, that of Muslims is projected to rise by 70%. In 2015, Muslims made up 24.1% of the global population. Forty-five years later, they are expected to make up more than three-in-ten of the worldï¿½s people (31.1%). This huge Muslim population is predicted to keep growing over the years.

Consequently, the number of Muslims may have an impact on to the awareness of each individual for applying the whole rule from Qurï¿½an. Basically, Qurï¿½an is based on Islamic principles and those principles are what dictate the laws of Islamic finance. The principle here called Sharia means the ï¿½path to be followedï¿½. As Muslim believe that Sharia is the best path coming from and going to Allah, they will feel obliged to strive for going on the path by implementing any instruction given in the Qurï¿½an and Sunnah. The enthusiasm and awareness for applying Islamic principle grow rapidly as the consequences of rising Muslim population.

Nowadays the Islamic principle-based products become well-known alternatives in the financial service sector. The Islamic financial service product which was highly recognized worldwide for couple decades is only the banking sector. However, its growth shows a significant decline from 49% in 2011 to 4% in 2015 which follows a 15% contraction in 2014. Therefore, other financial services including Islamic Pension Fund are needed to be explored to strengthen and sustain the Islamic finance industry. Reuters (2016) reports the global demand for Sharia-compliant pension funds is predicted to reach as high as US$ 190 billion.

Otoritas Jasa Keuangan (2015), in its Roadmap for Non-Bank Islamic Financial Industry 2015-2019, shows that 74.8% of workers and 85.7% of entrepreneurs in Indonesia have an interest in Islamic Pension Funds. This interest applies to people who do not have pension funds or who have conventional pension fund. Moreover, United Nation (2016) predicts the population of Indonesia, the largest home of Muslim population worldwide, will expand to 322 million by 2050 with people aging over 60s will triple to 62 million.ï¿½ It shows a huge demand that has not been explored by the market player in this industry.

Nowadays pension funds have become an important part of public financial planning. The existence of long-term benefits and ultimate socialization would make people more interested in having pension funds. Based on Otoritas Jasa Keuangan (2017), there are four million people who have become participants of the Pension Fund Financial Institutions (DPLK). The number was significantly increased compared to the position in 2010 where the new DPLK participant was 2.8 million people. If counted with government-sponsored pension funds through the Social Security Administering Agency (BPJS) of Employment that has reached eight million people out of 250 million Indonesians, 5.6% of the population or 14 million have retirement funds. The number of pension fund participants is projected to increase as growing figure of the pension fund product including Islamic Pension Fund.

The Islamic Pension Fund is more attractive after the release of the Indonesian Advisory Council (MUI) fatwa which provides Sharia funding opportunities to organize programs similar to annuity products. Following that, OJK also released its regulation Number 33/POJK.05/2016 about Islamic Pension Fund. Under this regulation, pension plans can be organized on the basis of sharia principles in four ways. Firstly, it can be done through the establishment of a new Islamic Pension Fund authorized by OJK. Secondly, conversion of conventional pension fund into the Islamic one. Thirdly, the establishment of Sharia Units in the Employer's Pension Fund (DPPK). Fourth, the establishment of Sharia units is realized in the sale of sharia investment packages in DPLK.

Previous literatures have proven an important role of attitude, including a study conducted by Wang, et al.(2008) which found attitude as one of the most important factors in determining consumer acceptance. Attitude has long been shown to have a close relationship with intention and to play a key role in behaviour formation (Ajzen, 1991; Ajzen & Fishbein, 1980; Smith et al., 2008). A meta-analytic study of 185 papers of theory of planned
behaviour showed a significant contribution of attitudes in forming intention directly,
together with the subjective norm and perceived behaviour control (Armitage & Conner, 2001).

In the context of Islamic financial product, most studies including Gait & Worthington(2008) and Loo (2010) have been carried out to reveal the importance of attitudes and expectations toward Islamic banking. A study conducted by Ramdhony(2013) found that 82% of respondents have awareness while 14% are not aware of Islamic financial products. This study also highlighted a significant relationship between public awareness and religion. The more pious people will lead to the greater chance of getting familiar with the Islamic financial products. Moreover, 66% of the respondents mentioned that the religious beliefs only motivate people to deal with Islamic financial product.

Meanwhile, another study conducted by Buchari, et al.(2015) found that most of the respondents believe that Islamic products and services are unique and have a sense of dealing with others. In addition, they believe that Islamic banking laws are derived from the Holy Quran and Sunnah. This concludes that more than 56% of respondents are aware of the Islamic financial products. Meanwhile, majority of the respondents have positive attitudes towards Islamic financial products and services. Statistically, it is also found that there are significant differences to gender and education level against the awareness and attitudes towards Islamic financial products and services while age and income both have insignificant differences.

Based on the above scheme, the demand of Islamic Pension Fund is predicted to be raised as much as the great number of Muslims in the world. This paper used primary data with 163 questionnaires spread through online surveys. It aims to examine the attitudes and expectations of Muslim population in Indonesia toward Islamic Pension Fund as well as its role of demographic factors. It is expected to discover the reason beyond the small number of Islamic Pension Fund unless the fact of rising the demand of Islamic Pension Fund (Otoritas Jasa Keuangan, 2015).

The significance of this study can be seen in at least two viewpoints. First, as far as it can be ascertained, there is no available data/research concerning the attitude
and expectation towards Islamic pension fund. This study aims to fill this gap. Second, this study focuses on Indonesia, which accounts for the most populated Muslims in the world, and is referred to as the ï¿½hidden treasureï¿½ (Wilson et al., 2013). In tune with the fact that the growth of Muslim population and the demand of Sharia-based pension fund in the world is flourishing, this research gives foundation to explore the potential yet untapped market.

ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ This study begins with the background of the study which is followed by the literature review relevant to this study as well as the development of hypothesis. After that, it presents the research method and the result. Finally, it concludes with summary, limitation, and recommendation for further research.

2. LITERATURE REVIEW

Theory of Planned Behaviour

The theoretical model employed in this research is based on theory of planned behaviour (TPB) (Ajzen, 1991). It is an extension of theory of reasoned action (TRA) and was established to answer the limitation in the TRA (Ajzen & Fishbein, 1980; Fishbein & Ajzen, 1975). TPB deals with behaviour where individual have incomplete faculty of using oneï¿½s will or situation where they have incomplete control of their behaviour. It postulates three conceptually independent determinants of intention (Ajzen, 1991). The first is the attitude toward the behaviour and refers to the degree to which a person has a favourable or unfavourable evaluation or appraisal of the behaviour in question. The second predictor is a social factor termed subjective norm. It refers to the perceived social pressure to perform or not to perform the behaviour. The last antecedent of intention is the degree of perceived behavioural control which, as we saw earlier, refers to the perceived ease or difficulty of performing the behaviour and it is assumed to reflect past experience as well as anticipated impediments and obstacles.ï¿½

The theory incorporates some of the central concepts in the social and behaviour sciences, and it defines these concepts in a way that permits prediction and understanding of particular behaviour in specified contexts. Attitudes toward the behaviour, subjective norms with respect to the behaviour, and perceived control over the behaviour are usually found to predict behavioural intentions with a high degree of accuracy. In this study, we integrate the subject norms and perceived control over behaviour into a single variable called expectation, which then combined with attitude to be examined.

To the best of the authorsï¿½ knowledge, TPB has yet to be applied towards the participation of Islamic pension fund. However, some researchers have applied the TPB in the context of conventional retirement planning (Clery, et al., 2007); Foster, 2017); Macleod et al., 2012)). To illustrate this, Foster (2017) utilises TPB to explore opportunities and attitudes of young people towards pensions, and identify a variety of factors which affect pension contributions, including knowledge and advice, trust and myopia. Meanwhile, Siang & Weng(2011) applied TPB in assessing intention to use Islamic banking products and services among non-Muslim consumers in Malaysia. Consistent with the suggestions of TPB, they found that respondentsï¿½ attitudes, subjective norms and perceived behavioural control were predictive of their intentions towards using Islamic banking products and services. They also found that, attitude is the most important influential factor followed by subjective norm andperceived behavioural control.

The most important role of attitude is that it predicts intention and, ultimately,
behaviour. Some researchers believe that attitude is the initial step for
product consideration and choice (Priester, et al., 2004). Even though this relationship is
vivid, one must examine closely to get an appropriate use of attitude in behavioural
prediction, just like what is mentioned by Wicker (1969), ï¿½attitudes can help predict behavioural intention and behaviour.

Meanwhile, the expectations defined as pre-experience beliefs of an actual experience yet to come(Oliver & Winer, 1987), they hold a crucial role in making decision with regard to the uncertain future (Robledo, 2001). He further explains that, managing the customerï¿½s expectations becomes an important part in ensuring customer satisfaction particularly for customers with relatively little experience with the service. Coye (2004) argues that the importance of fulfilling customer expectation should encourage the market players to be aware of their customer expectations.

In the context of a religion-related product, especially Islamic banking, there is strong
confidence that attitudes and expectations will simultaneously influence behaviour. Whereas, attitude and expectation toward retirement has been found to be important in one's planning for retirement fund (Atchley, 2000; Walker, et al., 1981). However, there have been few systematic efforts to explore those factors in oneï¿½s planning for retirement fund which based on Sharia principle.

Hypothesis Formulation

● Gender

In terms of the decision making process, Clark-Murphy & Gerrans(2001) identify that female fund members are less likely to consult work colleagues but are more likely to consult a finance professional and partner when making retirement savings decisions. Similar to prior research including Bajtelsmit, et al.(1999); Clark, et al.(2007); and Papke(1998)find that men are more risk tolerant than women. Males have generally been identified as more likely to make investment switches and to make riskier choices (i.e. higher growth assets, equity). It is in line with the study conducted by Clark and Strauss (2008) who asserts that men are more perceptive of the accomplishment of profits, and consequently take greater risks in making decisions on economic savings - an area where they consider themselves highly competent. They suggest that this difference clarifies menï¿½s overconfidence which also reflected in the culture of Muslim society, thus it will lead to the lower attitudes and expectation toward pension fund including the Sharia one.

H₁: There is different attitudes and expectations towards Islamic Pension Fund between male and female group

● Age

The pre-retirees and workers are woefully unprepared for their golden retirement years. Bernheim(1992) found that they save just one-third of what they needed to retire comfortably. In fact, Warshawsky and Ameriks(2016) indicated that half of the individuals aging between 25-71 years will not have sufficient savings to support themselves in retirement. In many developing countries, the retirement has not been completely institutionalized (Szinovacz, 2003).According to LIAM (Life Insurance Association of Malaysia) as quoted by The Star (2017), people in 20ï¿½s think that they are too young to think about retirement, while in 30ï¿½s and 40ï¿½s tend to believe they are prepared because they have their Employee Provident Fund (EPF) savings. Meanwhile the reality at 55 is that most people cannot afford to retire, since they prepared late for retirement.

H₂: There is different attitudes and expectations towards Islamic Pension Fund among age groups

● Income

Aside from gender and age, income and wealth have generally been positively related to the likelihood of choice (Clark-Murphy and Gerrans, 2001; Warshawsky and Ameriks, 2016). In addition to that, according to Kim, Kwon, & Anderson(2005), the individualï¿½s retirement confidence tend to be higher than others as they calculated their retirement fund needs and had more savings. The level of confidence will increase as the higher household income provided that they are with better health. The working individuals usually received workplace financial education and advice which could help them to have more confidence toward retirement planning (Power & Hira, 2004).

H₃: There is different attitudes and expectations towards Islamic Pension Fund among income groups

3. RESEARCH METHODS

3.1 Research Design

This study uses a quantitative method to identify trends or discover explanations for relationships among variables (Creswell, 2012). Both descriptive and inferential analyses are adopted to assess the demographic and independent variables. The instruments designed in nominal and interval scale where the average of group responses is calculated. Reliability test is used in order to know whether these research will produce consistent findings or not in different times, different scheme and under different conditions. This test is assessed by the Cronbachï¿½s Alpha values. The reliability test for both attitude and expectation resulted in score of 0.753 and 0.929 respectively. These score are higher than 0.70 which means that this study is reliable. Meanwhile, the measurement of relationship between variables is done by using Pearson correlations. Bryman & Cramer (2002) stated that Pearson correlation coefficient is indicating normality and linearity. Pearson has range between -1.0 to 1.0 indicating the strength of linear relationship. According to the Pearson correlation, the attitude and expectation towards Islamic Pension Fund have a positive correlation of 0.523 which indicate the variable is significantly correlated with another variable.

To test the effect of demographic variables, the Pearson correlation coefficients is used to indicate normality and linearity (Bryman & Cramer, 2002). Meanwhile, a series of two-tailed independent group t-tests and Kruskal Wallis test are conducted to confirm the hypotheses.

3.2 Questionnaire and Sample Frame

A convenient random sampling is used in this study. The respondents are Indonesian Muslim citizens aging from 18 to 64. A total of 250 questionnaires are distributed through an electronic survey system but only 163 of them are well-responded. As the target sample of this study was non-native English speakers, the Indonesian translation of each description, instruction and question was also presented in the survey.

Respondents were required to answer a series of questions in the form of a questionnaire which consisted of 34 questions divided into three sections. In Section A, we attempted to determine the respondentï¿½s demographic profiles by giving 12 questions to answer. Respondents were grouped by age, sex, level of education, marital status, etc. In Section B, 11 questions were given to determine the level of their attitude towards Islamic pension fund. In Section C, another set of 11 questions were given to determine the level of their expectation towards Islamic pension fund. Each set of question scales were scored in such a way so that higher values represented positive attitude/expectation about Islamic pension fund. A five-point Likert scale was used to gauge the response of the respondents, where 5 represented strongly agree and 1 represented strongly disagree.

4. RESULT AND DISCUSSION

4.1 Demographic Profile

The demographic profile consists of gender, age, marital status, number of dependants, monthly income and etc. Out of 163 respondents, there are 80 male and 83 female respondents. The respondentsï¿½ age distributions as 59.50% are in range between 18 to 24 years old, followed by 26.38% in range between 25 to 30 years old, then 7.97% are between 31 to 40 years old, followed by 3.68% between 41 to 50 and the last 2.45% of them are in range 51 to 64 years old. For the marital status, 77.91% are single, 21.47% are married, and 0.006% are divorced. Examining about the number of dependants, 63.8% respondents have no dependants, 9.2% have only one dependant, 25.15% have two to five dependants, and last 1.84% have more than five dependants.

As a type of occupation, full-time employees has the highest score for 53.98%, followed by 25.76% as unemployed, 10.42% as self-employed, and the last 9.81% as part-time employees. For the monthly income 46.62% has income less than 3 million rupiah, and 39.26% respondent has income between 3 million to 6 million rupiah. As 12.26% of respondents has income between 6 million to 10 million rupiah, the rest of respondents 1.84% has the highest income of more than 10 million rupiah. These proportion resulted because most of our respondents just started their career and still in the beginner or middle level.

4.2 Descriptive Data

As found in the result of questionnaire collected it shows the responses of 163 respondents on the attitude and expectations towards Islamic Pension Fund. We analyse further for the hindering factors as we concern more on the untapped market of Islamic Pension Fund. For the respondents currently do not have Islamic Pension Fund, table 1 is the highlighted responses. Table 1 also presents the respondents that have some expectations towards Islamic Pension Fund.

Table 1. Attitude and Expectation toward Islamic Pension Fund

Attitude				Expectation
Questions	Mean	Standard Deviation	Median	Questions	Mean	Standard Deviation	Median
Q1	0.54	0.145	0.56	Q1	0.71	0.161	0.61
Q2	0.54	0.185	0.44	Q2	0.75	0.172	0.95
Q3	0.76	0.243	0.48	Q3	0.81	0.201	0.70
Q4	0.76	0.235	0.48	Q4	0.80	0.184	0.63
Q5	0.55	0.186	0.34	Q5	0.83	0.206	0.57
Q6	0.31	0.196	0.24	Q6	0.84	0.210	0.52
Q7	0.56	0.191	0.41	Q7	0.86	0.212	0.48
Q8	0.64	0.238	0.25	Q8	0.86	0.216	0.42
Q9	0.61	0.156	0.55	Q9	0.86	0.218	0.41
Q10	0.63	0.223	0.37	Q10	0.83	0.209	0.52
Q11	0.69	0.153	0.32	Q11	0.81	0.178	0.72

4.3. Hypothesis Test

This section presents the results of hypotheses tests. Table 2 shows the comparison results of attitudes toward Islamic Pension Fund while table 3 indicates the different expectation toward Islamic Pension Fund.

Table 2: Results of Inferential Test of Attitudes

Criteria		Mean Rank	Significance	Hypothesis Test
Gender	Male	3.5661	0.002	Supported
Gender	Female	3.5693	0.002	Supported
Age	51-64	81.13	0.417	Rejected
	41-50	79.17
	31-40	71.96
	25-30	74.86
	18-24	84.87
Income	Less than 3 million	71.98	0.015	Supported
	3-6 million	77.21
	6-10 million	86.84
	More than 10 million	128.5

Table 3. Results of Inferential Test of Expectations

Criteria		Mean Rank	Significance	Hypothesis Test
Gender	Male	4.0502	0.007	Supported
Gender	Female	4.0825	0.007	Supported
Age	51-64	80.75	0.618	Rejected
	41-50	95.67
	31-40	97.38
	25-30	84.27
	18-24	78.14
Income	Less than 3 million	95.94	0.003	Supported
	3-6 million	71.11
	6-10 million	70.13
	More than 10 million	40.33

T-test also called two-sample t-test, is used to test the differences between the means of gender groups.ï¿½ The result 1of the analysis is reported as a p value. Based on the T-Test results shown in Table 2 and 3, it was found that the Female respondents have better attitudes and expectations towards Islamic Pension Fund than Male respondents. Yet, the differences are statistically significant since the p-value is 0.002 (Table 2) for attitude and 0.007 (table 3) for expectation which are less than 0.05. Thus, the H₁stating there is different attitudes and expectations towards Islamic Pension Fund between male and female is supported.

A Kruskal-Wallis test was used to determine whether the differences exist for the average weighted means of more than two groups. That does not differ from T-test. The responses of the respondents when grouped according to age, income, and type of employment/number of defendants will reflected in the dependent variable, attitudes and expectations. As depicted in Table 2 and 3, by grouping the respondents according to their age, those with the age from 18 to 24 years old have better attitudes and expectations towards Islamic Pension Fund, followed by the respondents from 51 to 60 years, then the respondents from 41 to 50 years old, then respondents from 25 to 30 years old, lastly respondents from 31 to 40 years old have the lowest attitudes and expectations towards Islamic Pension Fund. However, the differences are not statistically significant for both attitude and expectation since the p-value is above 5% (0.417 and 0.618 respectively). Thus, there is no different attitudes and expectations towards Islamic Pension Fund among age group.

As depicted in Table 3, by grouping the respondents are grouped according to their income, those with income worth more than 10 million have best attitudes and expectations towards Islamic Pension Fund, followed by the respondents with an income less than 3 million, the respondents with an income from 3 to 6 million, and then the respondents with an income from 6 to 10 million. More interestingly, the differences are statistically significant since the p-value is below 5% (0.0153 for attitude and 0.003 for expectation), thus there is different attitudes and expectations towards Islamic Pension Fund among income group

4.4 Discussion

Based on findings, untapped markets of Islamic Pension Fund rely on the awareness and trust of the respondents. As illustrated in Table 1, for the attitude, the highest weighted average is 0.76for the absence of knowledge and trust towards Islamic Pension Fund. Here, knowledge and trust of Islamic Pension Fund have role on determining their plan for pension fund. Dvorak and Hanley (2010) found that participants have a fairly good understanding of the basic mechanism of pension plan but they have insufficient knowledge to differentiate among numerous investment options. The future time perspective, financial knowledge, and financial risk tolerance are important variables when it comes to understanding individualsï¿½ retirement saving practices (Jacobs-Lawson and Hershey, 2005).

In a related Australian study, Gallery, et al.(2011) investigated financial literacy variability using a comprehensive survey of public sector superannuation fund members. Three measures of financial literacy were employed: general financial literacy, general investment literacy and specific investment knowledge. They also measure individualsï¿½ perceived versus actual financial literacy and report that the ability of investors to make optimal investment choices depends on the levels of financial literacy. In general, they find that although investor financial literacy is at a reasonable level, specific investment literacy was low. Wealth and household income are also identified as being positively related to investment knowledge. They highlight the importance of improving financial literacy through the use of education programs to prevent uninformed decisions that lead to unexpected and undesirable financial outcomes.

Recent survey results conducted byï¿½ ANZ (2011) also seem to show that lack of financial literacy is responsible for a third of the respondents who reported difficulty in understanding their superannuation statements. Financial literacy here refers to knowledge and understanding is therefore clearly an important contributing factor to individuals in making appropriate pension fund and investment decisions. International and national benchmark surveys of financial literacy present worryingly low levels of financial literacy: "Financial literacy is very low around the world, irrespective of the level of financial market development and the type of pension provision(Lusardi and Mitchell, 2011)".

Having the perspective of Indonesia, according to (MasterCard Index of Financial Literacy (2015), it is ranked at 10^th position with the overall score of 62. It shows the biggest improvement in ï¿½Financial Planningï¿½, increasing from 70 to 78 points; however it also experiences the largest decline in the ï¿½Investmentï¿½ component which dropped from 55 to 47. Indonesiaï¿½s newfound prudence in Financial Planning ï¿½ Indonesia has shown marked improvement of 8 points in the ï¿½Financial Planningï¿½ category, which has propelled it from 13^th to 5^th place. This could be a result of the insecurity in terms of income and employment prospects arising from the economic slowdown and tight labour market conditions in the 12 months prior to the survey. These conditions may be the driving force behind Indonesians being particularly prudent in financial planning, feeling the need to save regularly and set aside emergency savings, as well as develop an attitude of starting to save early, irrespective of oneï¿½s wealth. This progress is likely to continue with governmental reforms such as the five-year plan to encourage merger of the countryï¿½s three large state-owned Islamic banks in order to increase efficiency and develop innovative Islamic financial products.

On the other side, as illustrated in Table 2, for expectation, the highest weighted average is 0.86 to expect the allowance from government and simple administrative procedure. Automatic enrolment would be one of the best facility government could provide to invite more people to go for Islamic pension fund. As we know, at this time, there is no Sharia-compliant pension fund provided by government which brings a real obstacle for society to save for Islamic pension fund. With regard to this matter, government needs to take into account of all the possible ways to facilitate the society.

This study proves the significant effect of gender and income to decide for Islamic pension fund and its determinants (i.e., quality of service, trust, and compliance with Sharia law). Another personal characteristic, age, is found to be insignificant factor. ï¿½Women are more sensitive to the choice of Islamic pension fund than men. Service quality, trust, and Sharia compliance had a greater influence on womenï¿½s choice of Islamic pension fund. Islamic financial institutions should thus adopt gender as a main criterion of client segmentation and classification. Our results are consistent with the results of other studies indicating that women are more likely to comply (Sistrunk & McDavid, 1971) and are thus more impressionable than men (Aronson, 2004; Ltifi, et al., 2016).ï¿½ The generated results confirmed H₃ï¿½that the consumerï¿½s income exerts a moderating effect on the relationship between the choice of an Islamic product and the assurance of Sharia-compliant aspect. Our results are consistent with prior research showing dissimilarities among income groups (Ltifi et al., 2016).ï¿½ In our case, higher-income consumers tend to be more influenced than those with low income. This is confirmed by comparative studies between different income consumers (Patterson, 2007). Thus, it appears that women and higher-income consumers are the two categories most prone to be influenced to choose Sharia-compliant pension fund.

Our results also indicate that Islamic pension fund should allocate more resources to educate prospective customers about their products and services as well as their current clients and branch employees. The interviews highlighted that customers who are more familiar with products and services that comply with Sharia law tend to patronize Islamic pension fund.

The contributions of our work are interesting not only for researchers but also for managers and practitioners. In practical terms, this research allows the key players of Islamic pension fund to consider Word of Mouth Marketing, quality of service offered to customers, trust, and Sharia compliance, factors that explain a large part of a customerï¿½s selection. Additionally, our paper provides managers and leaders of Islamic pension fund a better understanding of how to achieve competitive advantage and create value for consumers through the improvement of these factors. Moreover, we identified two main customer segments with different expectations, for which Islamic pension fund can develop specific product and communication strategies.

5. CONCLUSION

Indonesian Muslim attitude and expectation towards pension fund show that Islamic Pension Fund should be more developed in several aspects. More than 60% of respondents disagree that they do not need Islamic Pension Fund which shows positive attitude toward Islamic Pension Fund. However, 61.02% of respondents showed that they do not know about Islamic Pension Fund. Consequently, almost 50% of respondents expected massive socializations, better and easier facility, clear and transparent management and other good expectations towards Islamic Pension Fund. Statistically, it is also found that there are significant differences to gender and income level against the attitude and expectation toward Islamic Pension Fund, while age has insignificant difference.

The findings of the research convey the standard of Muslimï¿½s attitude and expectation toward Islamic Pension Fund in Indonesia which could also be the reflection for Muslim countries worldwide. This information will be useful for solving the huge gap between the demand and supply of Islamic Pension Fund since it will help to raise the awareness of market players and society to see the Islamic Pension Fund as a promising and prospective industrial sector in the foreseeable future. For the acceleration of this industry, this study suggests government to formulate a supportive regulation which triggers Indonesiaï¿½s Social Security Agency (BPJS) to offer the Sharia-compliant plan. The national program is believed to push the private insurance companies to promote the plan a way better than what they are doing right now. The market players of Islamic pension fund should market their products more attractively and provide better service for the potential customer. Even further, corporate could provide auto-enrolment for those who are willing to have Sharia-compliant retirement planning. As an early movement, it might start with woman and high-income society which are found to be more interested in Islamic pension fund.

However, this study still consists of few limitations such as: (i) skewness of population that limit to restricted society in the Indonesian Muslim and (ii) the sample distribution did not cover the whole region of Indonesia. Thus, the final result may not perfectly represent the population in the sector. The forthcoming researchers could perhaps add more variables of assessing the attitude and expectation of potential customers, while covering a larger sample of the study should be taken into account.

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APPENDIX

Survey Questions

I. Identification of Respondent

1. What is your gender?

a. Male

b. Female

2. What is your age?

a. 18-25

b. 25-30

c. 30-40

d. 40-50

e. 50-64

3. What is your marital status?

a. Single

b. Married

c. Divorced

d. Widowed

4. How many dependants you have?

a. 0

b. 1

c. 2-5

d. More than 5

5. What city do you currently live?

6. What is your occupation?

a. Unemployed

b. Self-employed

c. Full-time employee

d. Part-time employee

7. How much money your earn in a month?

a. Less than IDR 3,000,000

b. IDR 3,000,000 - 6,000,000

c. IDR 6,000,000 - 10,000,000

d. More than IDR 10,000,000

8. Do you have pension fund?

a. Yes

b. No

9. Do you have Islamic Pension Fund?

a. Yes

b. No

10. If yes, how much money you allocate to Islamic Pension Fund?

a. Less than 5% of income

b. 5-10% of income

c. 10-15% of income

d. More than 15 % of income

e. NA (0)

11. When did you start allocating your money to Islamic Pension Fund?

a. Lessï¿½ than 1 year

b. 1-2 years

c. 2-3 years

d. NA

12. Where do you arrange your Islamic Pension Fund?

a. Islamic Bank

b. Company Where I Work

c. Insurance Company

d. Non-Bank Financial Institutions

e. Others

II. The Frequency of Attitude Toward Islamic Pension Fund (Hindering Factors)

ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ I do not choose Islamic Pension Fund because ...

No.		Extremely agree	Agree	Neutral	Disagree	Extremely Disagree
1.	I donï¿½t have a stable income	4.29%	23.93%	31.90%	28.22%	11,66%
2.	I donï¿½t need Islamic Pension Fund	3.68%	9.82%	26.38%	43.56%	16,56%
3.	I donï¿½t know the concept of Islamic Pension Fund	14.11%	62.58%	15.95%	4.29%	3,07%
4.	I donï¿½t trust the concept of Islamic Pension Fund	14.72%	61.35%	15.95%	4.91%	3,07%
5.	I donï¿½t think Islamic Pension Fund can strengthen the economy of ummah	1.84%	7.36%	44.17%	34.36%	12,27%
6.	The management of Islamic Pension Fund is not optimal	0.61%	3.07%	7.98%	39.26%	49,08%
7.	Nobody around me use Islamic Pension Fund, why should I?	2.45%	7.98%	37.42%	41.10%	11,04%
8.	In practice, Islamic Pension Fund does not make any difference with its conventional counterpart	4.91%	16.56%	63.80%	12.27%	2,45%
9.	I only follow the pension fund policy of company where I currently work	2.45%	19.02%	45.40%	27.61%	5,52%
10.	There is no one offering Islamic Pension Fund to me	2.45%	15.34%	61.35%	18.40%	2,45%
11.	As a Muslim, I think there is no obligation/encouragement to have Islamic pensionï¿½ fund	5.52%	44.79%	30.67%	15.95%	3,07%

III. The Frequency of Expectation Toward Islamic Pension Fund

ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ In the future, I expect Islamic Pension Fund ...

No.	Questions	Extremely agree	Agree	Neutral	Disagree	Extremely Disagree
1.	Return rate of Islamic Pension Fundï¿½ should be higher than its conventional counterpart	4.29%	23.93%	31.90%	28.22%	11.66%
2.	There should be an auto enrolment from corporate for all employees	3.68%	9.82%	26.38%	43.56%	16.56%
3.	There should be a massive socialization about Islamic Pension Fund	14.11%	62.58%	15.95%	4.29%	3.07%
4.	There should be an easy access and adequate facility to Islamic Pension Fund	14.72%	61.35%	15.95%	4.91%	3.07%
5.	There should be better service for Islamic Pension Fund	1.84%	7.36%	44.17%	34.36%	12.27%
6,	There should be reassurance of Sharia compliant qualities	0.61%	3.07%	7.98%	39.26%	49.08%
7.	There should be allowance from government	2.45%	7.98%	37.42%	41.10%	11.04%
8.	The cost for Islamic Pension Fund should be lower than its conventional counterpart	4.91%	16.56%	63.80%	12.27%	2.45%
9.	A simple administrative procedure toï¿½ release the fund at the time	2.45%	19.02%	45.40%	27.61%	5.52%
10.	Islamic Pension Fund should be more reliable and trusted (amanah)	2.45%	15.34%	61.35%	18.40%	2.45%
11.	The management of Islamic Pension Fund should be more transparent and clear	5.52%	44.79%	30.67%	15.95%	3.07%