Abstract
This paper aims to provide an overview of customer trust toward Islamic banks, and to study the effect of trust on the selection of Islamic banks services. A total 375 questionnaires were distributed to the three groups of bank customers, i.e. Islamic banks customers, conventional banks customers, and customers of both banks (125 respondents in each group). Trust is measured based on three constructs, namely Ability, Integrity, and Benevolence. To test the hypothesis this study employs Analysis of Variance and Tukey Test. The results show that bank customers have degree of trust towards Islamic banks relatively high enough, although among the respondents had never become customers of Islamic banks. Benevolence as the dimension with the lowest average score revealed the Islamic banks are more believed as a competent and honest bank in carrying out the business than the bank that will work for the benefit of customers. Other findings suggest that degree of trust have significant affects on the decision for using the Islamic banks services. The positive values that embedded in the concepts and systems of the Islamic is the key to improving the competitiveness of Islamic banks.