I hear that good character is half the religion, but surely prayer and fasting matter more than just being nice to people?

Let me set your mind at rest at the start: no one is asking you to trade worship for good manners. The tradition never separates the two. It ties them together and shows that one is meant to grow out of the other.

When you hear that good character is half the religion, do not picture it competing with your salah. Picture instead the scale of deeds on the Day of Resurrection, and what the Prophet placed upon it.

“Nothing is heavier in the believer’s scale on the Day of Resurrection than good character.”

The Prophet (peace be upon him), Jami’ at-Tirmidhi (2002) · meaning

He did not say that character outweighs prayer. He spoke of a weight that nothing surpasses. And he joined faith itself to gentleness of manner, so that the two grow as one.

“The most complete of believers in faith are those best in character.”

The Prophet (peace be upon him), Jami’ at-Tirmidhi (1162) · meaning

Even the purpose of his coming he summed up in a single line, and he left nothing outside beautiful conduct.

“I was sent only to perfect good character.”

The Prophet (peace be upon him), al-Adab al-Mufrad of al-Bukhari (273) · meaning

Here is the quiet key. It is a habit of our age to file worship in one drawer and behaviour in another, as though they were separate lives. The tradition keeps them close. The whole fruit of prayer is a softer, kinder dealing with people, and a fast that leaves the tongue gentle and the temper even is a fast that has reached the heart. So your prayer and your fasting are not rivals to good character; they are its roots, and good conduct is what those roots were always growing toward. Tend the root, and the fruit will come.

One small step: After your next salah, before you rise from the mat, decide on one specific act of kindness for the very next person you meet, and let that be your prayer’s first fruit.