ii

DECLARATION OF ORIGINAL WORK

BACHELOR OF BUSINESS ADMINISTRATION
WITH HONOUR (FINANCE)
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA
"DECLARATION OF ORIGINAL WORK"


I, ROIHAN BINTI YAZIT, (I/C Number: 891113-07-5124)


Hereby, declare that:

This work has not previously been accepted in substance for any
degree, locally or overseas, and is not being concurrently submitted for
this degree or any other degrees.


This project-paper is the result of my independent work and
investigation, except where otherwise stated.


All verbatim extracts have been distinguished by quotation marks and
sources of my information have been specifically acknowledged.



Signature:_________________________ Date:______________________







iii

LETTER OF SUBMISSION

7
th
January 2013


The Head of Program
Bachelor of Business Administration with Honour (Finance)
Faculty of Business Management
Universiti Teknologi MARA
02600 Arau
Perlis



Dear Sir/ Madam,




SUBMISSION OF PROJECT PAPER (FIN 660)


Attached is the project paper titled AWARENESS AND ACCEPTANCE OF AR-
RAHNU SCHEME: A CASE STUDY OF BANK KERJASAMA RAKYAT GREENTOWN
BRANCH to fulfil the requirement as needed by the Faculty of Business Management,
Universiti Teknologi MARA.






Thank you.




Yours sincerely,






ROIHAN BINTI YAZIT
2010124335
Bachelor of Business Administration with Honour (Finance)



iv

ACKNOWLEDGEMENTS

Bissmillahirrahmanirahim (In the name of Allah, Most Gracious, Most Merciful),
Alhamdulillah, praise to Allah as for His blessings giving me the strength, patience and
ability that this thesis can be completed within the stipulated time frame without any
major hurdle. This project paper was prepared to fulfil the requirement for the Bachelor
of Business Administration (Hons), Finance. My greatest appreciation goes to my thesis
advisor, Associate Professor Madya Azman Bin Daim for his guidance, encouragement
and comments as without it this thesis would not have been satisfactorily fulfilled and not
forgetting my co-advisor Miss sharazad Binti Haris, who had advised me efficiently and
effectively from the beginning through the end of this research. I greatly appreciate their
time, feedback, and comment that they have provided me in order to improve this project
paper. Without their help, this project paper might not be completed. I offer my sincerest
gratitude to my supervisor, Nurliza Binti Tajudin, who has supported me throughout my
thesis with his patience and knowledge whilst allowing me the room to work in my own
way. She also helps me throughout my practical training period by giving advice and
teaches me all about Banking industry. To all my family members especially my beloved
mom Siti Sabariah Osman and my dad Yazit Hassan who have been very supportive
and understanding, patient and inspiring, I am very much indebted to all of them. And
last but not least I would like to thank to all my colleagues and friends for their ideas and
support for the success of my study. I also want to thank anybody that I have not
mentioned here, wherever they are, who in any way has contributed to the
accomplishment of this thesis.



v










TABLE OF CONTENTS


Page
ACKNOWLEDGEMENT iv
TABLE OF CONTENTS v
LIST OF FIGURES vii
LIST OF TABLES viii
LIST OF APPENDICES ix
ABSTRACT x

CHAPTER 1 INTRODUCTION
1.1 Background of Study 1
1.2 Background of the Company 6
1.3 Problem statement 9
1.4 Objectives 11
1.5 Research Questions 12
1.6 Significance of Study 13
1.7 Scope of Study 15
1.8 Limitations 16
1.9 Definition of Terms 19

CHAPTER 2 LITERATURE REVIEW
2.0 Overview 20
2.1 Literature review 20





vi

CHAPTER 3 RESEARCH METHODOLOGY
3.0 Overview 42
3.1 Data Collection Method 42
3.1.1 Primary Data 43
3.1.2 Secondary Data 45
3.1.3 Observational Surveys 46
3.2 Scaling Techniques 47
3.3 Location of the Study 49
3.4 Population and Sampling 49
3.4.1 Population 49
3.4.2 Sample Size 50
3.4.3 Sampling Techniques 50

CHAPTER 4 FINDINGS AND ANALYSIS
4.1 Data Description 52
4.2 Data Interpretation 53

CHAPTER 5 CONCLUSIONS AND RECOMMENDATION
5.1 Conclusions 91
5.2 Recommendation 93


BIBLIOGRAPHY 96

APPENDICES

101













vii


LIST OF FIGURES



Figure: Page
Figure 1 Chart of Level of Awareness among Respondents 53
Figure 2 Chart of Level of Awareness among Male and Female
Respondents
54
Figure 3 Chart of Level of Awareness according to
Respondents age
57
Figure 4 Chart of Level of Awareness among Malay, Chinese
and Indian Respondents
59
Figure 5 Chart of Level of Awareness according to
Respondents Level of Education
61
Figure 6 Chart of Level of Awareness according to
Respondents Profession
63
Figure 7 Chart of Level of Awareness according to
Respondents Income
65
Figure 8 Chart of Level of Awareness according to Marketing
Tools
67











viii

LIST OF TABLES



Table: Page
Table 1 Market Performance on Ar-Rahnu Scheme among Bank 08
Table 2 Frequency of Ar-Rahnu Customer 68
Table 3 Frequency of Storage Charge Questions 69
Table 4 Frequency of Service Quality Questions 72
Table 5 Frequency of Locality Questions 77
Table 6 Frequency of Management Questions 80
Table 7 Frequency of Shariah View Questions 84


















ix

LIST OF APPENDICES




Appendix: Page
Appendix 1: Questionnaire....... 101
Appendix 2: Mean Calculation.. 109
Appendix 3: Raw Data 110



















x

ABSTRACT


Conventional based pawn broking had been created a large exploitation and injustice to
the customer (borrower) since the customer was burden with the high interest rate
imposed on the loan. Government had been realizing the need of Islamic pawn broking
and the establishment of the Islamic pawn broking. However, there is a problem occur
which is whether customer aware there is Ar-rahnu (Islamic pawning scheme) offer in
Bank Rakyat and what factors influence the acceptance of customer of Ar-rahnu Bank
Rakyat. The questionnaire had been distribute to 60 respondents to analyze whether
they were aware the existence of Ar-Rahnu scheme at Bank Rakyat and what factors
contributed to their acceptance for using Ar-Rahnu service at Bank Rakyat. Based on
the findings indicate the factors that affect the respondents awareness were the age
level, race and the marketing tools. For factors that lead to the acceptance of Ar-Rahnu
at Bank Rakyat were storage fee, service quality, management and shariah view. To
increase the level of customer awareness and acceptance, Bank management should
increase their advertising tools and prepared high service quality to customers.