Abstract

The general relationship between a bank and customer is contractualin nature. For conventional banks, the banker-customer relationship is basedon the debtor-creditor relationship with the bank earning a profit from a spreadmade between interest charged on the borrower of funds and interest paid tothe depositors. In Islamic banking, due to the different contractual transactionsof Islamic banking operation, it is based on a multi-contractual relationships.However, bank consumers perceive that banks enhance their profits by treatingconsumers unfairly and failing to take responsibility when things go wrong.This study examines the duty of care of conventional and Islamic banks towardsbank consumers. It also focuses on the Islamic banks’ duty of care from theperspective of maqāṣid al-Sharī‛ah, to those who use their services. Adoptingthe doctrinal analysis method, this study analyses and compares the duty ofcare of both conventional and Islamic banks. Findings of this study includethat misconduct by banking industries remains rife and that unfair treatment ofcustomers are frequent. As for Islamic banks, the maqāṣid al-Sharī‛ah basedduty of care is found missing in their Islamic banking operation. This studysuggests that the duty of care for both banks should be reformed to improvebank consumers’ experience. For Islamic banks, an improved standard is usefulin performing their duties based on Islamic values.