Decomposing Perceived Behavioural Control: Addressing Financial Literacy in Determining Muslims’ Intention to Purchase Unsought Products

Abstract

Purpose: This paper addresses the importance of planning for unanticipated risks which may lead to losses in peoples’ lives and in this study, the lives of Muslim consumers when they are not managing unanticipated risks well. The need to purchase unsought products like life insurance/Takaful dictates the relevance of financial literacy in affecting perceived behavioural control that may influence purchase intention. Design/methodology/approach: This study uses Structural Equation Modelling as means of assessing the proposed framework. Using the Decomposed Theory of Planned Behaviour (DTPB) as the basis, this paper examines the relevance of determinants affecting perceived behavioural control in influencing purchase intention of unsought goods with financial literacy as a new determinant in the DTPB framework.  Findings: The findings reveal that financial literacy, resource facilitating condition and self-efficacy affect perceived behavioural control which ultimately influence purchase intention. Practical implications: By examining financial literacy, resource facilitating condition and self-efficacy on perceived behavioural control, the study validated the importance of these constructs in affecting consumers’ perceived behavioural control and purchase intention. This study would be useful to life insurance operators, as the findings can be inputs for the formulation and implementation of promotional strategies for life insurance/Takaful. Originality/value: This study provides insights for the inclusion of financial literacy as one of the determinants in the decomposition of perceived behavioural control.