Warm-Glow Giving, Hedonism, and Their Influence on Muslim User Engagement on Loan-Based Crowdfunding Platforms

Sutanto, Juliana, Wenninger, Helena, Duriana, Handre

Journal of the Association for Information Systems · 2021 · Volume 22 · Issue 2

Abstract

This paper investigates how platform design features affect the funding motivation of Muslim users on loan-based crowdfunding platforms. Theoretically grounded in Andreoni’s warm-glow giving theory and Sober and Wilson’s model of evolutionary and psychological giving, this work has high practical relevance, given the increasing demand for Islamic financial products. Loan-based crowdfunding platforms are important to the unique context of this research since Islamic religious constraints regulate monetary transactions involving lending. We used a scenario-based survey developed on the basis of a pilot study and confirmed by our manipulation check. The results show that “hedonism” represented by monetary interest negatively affected Muslim users’ willingness to engage in a loan-based crowdfunding project. This finding challenges the commonly agreed-upon egoistic motivator for loan-based crowdfunding platforms (i.e., monetary interest), which is based on Western Christian and Chinese Confucian capitalist economic and financial paradigms. Remarkably, we also found that Muslim funders’ level of willingness to engage on the hedonistic platform had an exponentially positive effect on the amount of money that funders were willing to lend. By contrast, “warm-glow giving,” manifested as belonging to a community, had no effect on users’ engagement. Implications of these findings for theory and practice are discussed.

Keywords

Loan-Based Crowdfunding, Platform Design, Muslim Users, Willingness to Engage, Amount To Lend, Lender Motivation

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