The Impact of Shari’a Compliance on The Efficiency of Islamic Banks at Jordan: The Mediating Role of Shari’a Supervision

Abstract

Abstract

This study aims to analyze the impact of Sharīʿah controls governing exchange-based contracts on the efficiency of banking in Jordanian Islamic banks, with Sharīʿah supervision serving as a mediating variable. The study focuses on two major contracts: Murābaḥah to the purchase orderer and lease ending with ownership, while banking efficiency is examined through four dimensions: administrative, ethical, market, and financial efficiency. The study adopted a quantitative descriptive-analytical approach and used a questionnaire as the main data collection tool. The study population consisted of all employees working in Jordanian Islamic banks, totaling 4,432 employees. A proportional stratified random sample of 354 respondents was selected, of whom 323 valid responses were analyzed. Data were processed using SPSS and AMOS. The findings revealed a strong positive and statistically significant effect of Sharīʿah controls on banking efficiency. The results also showed that Sharīʿah controls, banking efficiency, and Sharīʿah supervision all achieved high levels of relative importance, with mean scores of 3.925, 3.917, and 3.930, respectively. Moreover, Sharīʿah supervision was found to play a significant mediating role in strengthening the relationship between Sharīʿah controls and banking efficiency. The study recommends enhancing integration between Sharīʿah supervisory bodies and banking administrations, developing specialized training programs for employees, and strengthening practical mechanisms that ensure compliance with Sharīʿah controls in order to improve institutional performance and sustainable banking efficiency.