Expectations of individuals regarding the Ijara Forward contract: the case of healthcare financing

Abstract

The health sector in Morocco is marked by many achievements, but also by large deficits, especially in terms of healthcare expenditures borne by individuals. With the introduction of Islamic banks (called participative banks) in Morocco, the study aims to determine the extent to which Ijara Forward, as an Islamic financial contract, is adapted to the expectations of Moroccans to finance their health expenditures.The study sample consisted of 200 individuals. The univariate and bivariate analyses are used to identify possible relationships between the study variables. In addition, this paper proposes a model that will predict the demand for Ijara Forward based on the logistic regression method. The results reveal that the financial characteristics of the Ijara Forward contract are in line with the financial expectations of Moroccan individuals. Furthermore, the cost of health services is the main factor that makes healthcare inaccessible. This factor influences the demand of Ijara Forward. In addition, this paper reveals that religious beliefs stimulate Ijara Forward’s demand and encourages people to pay a higher price for Ijara Forward.

Keywords

• Islamic finance
• logistic regression
• Morocco
• participative banks
• personal health finance