Understanding Consumers’ Mobile Banking Adoption through the Integrated Technology Readiness and Acceptance Model (TRAM) Perspective: A Comparative Investigation
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Published:
Oct 17, 2019
Keywords:
Mobile banking, Technology Readiness and Acceptance Model, Technology Acceptance Model, Technology Readiness Index, customer satisfaction and loyalty
Main Article Content
Abstract
The study compared the differences and similarities in mobile banking adoption in developed and developing economies, specifically Australia and Kenya. Technology Readiness and Acceptance Models were used to examine the responses of 450 participants from each country through an online questionnaire. Results from structural equation modeling indicated that whereas Optimism and Innovativeness significantly influenced customers’ perceived ease of use and usefulness of mobile banking in Kenya, they did not have the same effect in Australia. Insecurity and Discomfort have a significant negative influence on the perceived ease of use and usefulness of mobile banking in Australia, but discomfort did not affect perceived ease of use in Kenya. In terms of satisfaction and loyalty, only perceived usefulness failed to affect satisfaction of customers in Australia. These results strengthened conclusions drawn from previous studies, particularly in affirming knowledge that Discomfort had no negative effect on perceived ease of use in Kenya (developing economy), a result not yet stated by many existing studies. Business practitioners and policy-makers, especially in Kenya, could benefit from the findings of this study through sensitizing people to the significance of comfortability in handling technology and its applications, with clear emphasis on financial transactions.
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Research Articles
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References
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Barnes, S., & Corbitt, B. (2003). Mobile banking: Concept and potential. International Journal Mobile Communications, 1(3), 273–288.
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Boston Consulting Group, (2016). Retail Bank Operational and Digital Leaders Reap the Rewards. Retrieved from https://www.bcg.com/publications/2016/financial-institutions-retail-banks-operational-and-digital-leaders-reap-the-rewards-part-of-banking-on-digital-simplicity.aspx
Browne, M., & Cudeck, R. (1993). Alternative ways of assessing model fit. Sage Focus Editions, 154, 136–136.
Byrne, B. (1994). Structural equation modeling with EQS and EQS/Windows: Basic concepts, applications, and programming. Thousand Oaks, CA: Sage.
Casaló, L., Flavián, C., & Guinalíu, M. (2008). The role of satisfaction and website usability in developing customer loyalty and positive word-of-mouth in the e-banking services. International Journal of Bank Marketing, 26(6), 399–417.
Chen, S., Chen, H., & Chen, M. (2009). Determinants of satisfaction and continuance intention towards self-service technologies. Industrial Management & Data Systems, 109(9), 1248–1263.
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De Jong, A., De Ruyter, K., & Lemmink, J. (2003). The adoption of information technology by self-managing service teams. Journal of Service Research, 6(2), 162–179.
Donner, J., & Tellez, C. (2008). Mobile banking and economic development: Linking adoption, impact, and use. Asian Journal of Communication, 18(4), 318–332.
Dupas, P., Green, S., Keats, A., & Robinson, J. (2012). Challenges in banking the rural poor: Evidence from Kenya's western province (Paper No. 17851). Cambridge: National Bureau of Economic Research. Retrieved from https://www.nber.org/papers/w17851
Gandhi, A., & Sheorey, P. (2017). Mobile banking adoption in a developing country like India. Drishtikon: A Management Journal, 8(2), 29–42.
George, A., & Kumar, G. (2013). Antecedents of customer satisfaction in internet banking: Technology acceptance model (TAM) redefined. Global Business Review, 14(4), 627–638.
Godoe, P., & Johansen, T. (2012). Understanding adoption of new technologies: Technology readiness and technology acceptance as an integrated concept. Journal of European Psychology Students, 3(1), 38–52. DOI: https://doi.org/10.5334/jeps.aq
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Hu, L., & Bentler, P. (1998). Fit indices in covariance structure modeling: Sensitivity to under parameterized model misspecification. Psychological Methods, 3(4), 424–453.
Karahanna, E., & Straub, D. (1999). The psychological origins of perceived usefulness and ease-of-use. Information & Management, 35(4), 237–250.
Khadka, R., & Kohsuwan, P. (2018). Understanding consumers' mobile banking adoption in Germany: An integrated technology readiness and acceptance model (TRAM) Perspective. Catalyst, 18, 56–67.
Kitapci, O., Dortyol, I., Yaman, Z., & Gulmez, M. (2013). The paths from service quality dimensions to customer loyalty: An application on supermarket customers. Management Research Review, 36(3), 239–255.
Koksal, M. (2016). The intentions of Lebanese consumers to adopt mobile banking. International Journal of Bank Marketing, 34(3), 327–346.
Laforet, S., & Li, X. (2005). Consumers’ attitudes towards online and mobile banking in China. International Journal of Bank Marketing, 23(5), 362–380.
Liao, C., Tsou, C., & Huang, M. (2007). Factors influencing the usage of 3G mobile services in Taiwan. Online Information Review, 31(6), 759–774.
Lin, C., & Lu, H. (2000). Towards an understanding of the behavioural intention to use a web site. International Journal of Information Management, 20(3), 197–208.
Lin, C., Shih, H., Sher, P., & Wang, Y. (2005, July). Consumer adoption of e-service: Integrating technology readiness with the technology acceptance model. Paper presented at Technology Management A Unifying Discipline for Melting the Boundaries Conference, 31 July–4 August 2005 (pp. 483–488). Portland, USA: IEEE.
Littell, R., Henry, P., & Ammerman, C. (1998). Statistical analysis of repeated measures data using SAS procedures. Journal of Animal Science, 76(4), 1216–1231.
Lomax, R., & Schumacker, R. (2004). A beginner's guide to structural equation modeling (2nd ed.). New York: Psychology Press.
Luarn, P., & Lin, H. (2005). Toward an understanding of the behavioral intention to use mobile banking. Computers in Human Behavior, 21(6), 873–891.
Manica, L., & Vescovi, M. (2009). Mobile telephony in Kenya… Is it Making the life better? University of Trento. Retrievied from https://www.researchgate.net/publication/228900464_Mobile_ Telephony_in _Kenya_ is_it_Making_the_life_better
Marsh, H., Balla, J., & Hau, K. (1996). An evaluation of incremental fit indices: A clarification of mathematical and empirical properties. In G. A. Marcoulides, & R. E. Schumacker (Eds.), Advanced structural equation modeling: Issues and techniques, (pp. 315–353). Mahwah, NJ: Lawrence Erlbaum.
Maurer, B. (2008). Retail electronic payments systems for value transfers in the developing world. Department of Anthropology, University of California, Irvine. Retrieved from https://www.anthro.uci.edu/ faculty_bios/maurer/Maurer-Electronic_payment_systems.pdf
Mbiti, I., & Weil, D. (2011). Mobile banking: The impact of M-Pesa in Kenya, (Working Paper No. 2011–13). Brown University, Department of Economics, Providence, RI Retrieved from https://www.econstor.eu/ bitstream/10419/62662/1/668481188.pdf
Medhi, I., Ratan, A., & Toyama, K. (2009). Mobile-banking adoption and usage by low-literate, low-income users in the developing world. Paper presented at International conference on internationalization, design and global development. Springer, Berlin, Heidelberg. Retrieved from https://doi.org/10.1007/978-3-642-02767-3_54
Moon, J., W., & Kim, Y. (2001). Extending the TAM for a world-wide-web context. Information & Management, 38(4), 217–230.
Ndirangu, L., & Nyamongo, E. (2014). Financial innovations and their implications for monetary policy in Kenya. Journal of African Economies, 24(1), i46–i71.
Ngugi, B., Pelowski, M., & Ogembo, J. (2010). M‐pesa: A case study of the critical early adopters’ role in the rapid adoption of mobile money banking in Kenya. The Electronic Journal of Information Systems in Developing Countries, 43(1), 1–16.
Odera, E. (2013). Mobile banking adoption in the banking industry in Kenya. University of Nairobi 2013 (Unpublished manuscript), Department of Business Administration, University of Nairobi, Kenya. Retrieved from https://chss.uonbi.ac.ke/sites/default/files/chss/ESTHER%20A.%20OUKO%20ODERA% 20D61 -71319-2008_0.pdf
Oliver, R. (1999). Whence consumer loyalty? Journal of marketing, 63(1), 33–44.
Oliver, R. (1981). Measurement and evaluation of satisfaction processes in retail settings. Journal of Retailing, 57(3), 25–48.
Özbek, V., Alnıaçık, Ü., Koc, F., Akkılıç, M., & Kaş, E. (2014). The impact of personality on technology acceptance: A study on smart phone users. Procedia-Social and Behavioral Sciences, 150, 541–551.
Parasuraman, A. (2000). Technology Readiness Index (TRI): A multiple-item scale to measure readiness to embrace new technologies. Journal of Service Research, 2(4), 307-320.
Parasuraman, A., & Colby, C. (2015). An updated and streamlined technology readiness index: TRI 2.0. Journal of Service Research, 18(1), 59-74.
Quoquab, F., Abdullah, N., & Mohammad, J. (2016). Investigating the effects of consumer innovativeness, service quality and service switching costs on service loyalty in the mobile phone service context. Gadjah Mada International Journal of Business, 18(1), 21–53.
Schutt, R. (2018). Investigating the social world: The process and practice of research (9th ed.). Thousand Oaks, CA: Sage Publications
Talukder, M., Quazi, A., & Sathye, M. (2014). Mobile phone banking usage behaviour: An Australian perspective. Australasian Accounting, Business and Finance Journal, 8(4), 83–104.
Tsikriktsis, N. (2004). A technology readiness-based taxonomy of customers: A replication and extension. Journal of Service Research, 7(1), 42–52.
Ullman, J., & Bentler, P. (2003). Structural equation modeling. In J. A. Schinka & W. F. Velicer (Eds.), Handbook of psychology: Research methods in psychology, Vol. 2, pp. 607–634. Hoboken, NJ, US: John Wiley & Sons Inc.
Venable Telecommunications and Financial Services. (2008). Mobile Banking. White Paper of November. Retrieved from https://www.venable.com/-/media/files/publications/2008/11/mobile-banking/files/ mobile-banking/fileattachment/2010.pdf
Walczuch, R., Lemmink, J., & Streukens, S. (2007). The effect of service employees’ technology readiness on technology acceptance. Information & Management, 44(2), 206–215.
Ward, S., Chitty, B., & Graham, G. (2007). Finding the tutorial I want: An examination of factors leading to adoption of online self service technology. In Proceedings of the ANZMAC Conference 2007, Otago, Dunedin, New Zealand, 2580–2587. Retrieved from https://conferences.anzmac.org/ANZMAC2007/ papers.html.
World Bank. (2017). Commercial bank branches (per 100,000 adults). Retrieved from https://data.worldbank. org/indicator/fb.cbk.brch.p5
Yang, Z., & Peterson, R. (2004). Customer perceived value, satisfaction, and loyalty: The role of switching costs. Psychology & Marketing, 21(10), 799-822.
Asmar, M. (2017, June 7). Factors affecting the adoption of mobile banking in Palestine [Video file]. Retrieved from https://www.youtube.com/watch?v=WEM-y15ANh0
Amin, M., Rezaei, S., & Abolghasemi, M. (2014). User satisfaction with mobile websites: the impact of perceived usefulness (PU), perceived ease of use (PEOU) and trust. Nankai Business Review International, 5(3), 258–274.
Asongu, S., & Odhiambo, N. (2019). Mobile banking usage, quality of growth, inequality and poverty in developing countries. Information Development, 35(2), 303-318.
Barnes, S., & Corbitt, B. (2003). Mobile banking: Concept and potential. International Journal Mobile Communications, 1(3), 273–288.
Bloemer, J., De Ruyter, K., & Peeters, P. (1998). Investigating drivers of bank loyalty: The complex relationship between image, service quality and satisfaction. International Journal of Bank Marketing, 16(7), 276–286.
Bongomin, G. O., Ntayi, J. M., Munene, J. C., & Malinga, C. A. (2018). Mobile money and financial inclusion in Sub-Saharan Africa: The moderating role of social networks. Journal of African Business, 19(3), 361–384.
Boston Consulting Group, (2016). Retail Bank Operational and Digital Leaders Reap the Rewards. Retrieved from https://www.bcg.com/publications/2016/financial-institutions-retail-banks-operational-and-digital-leaders-reap-the-rewards-part-of-banking-on-digital-simplicity.aspx
Browne, M., & Cudeck, R. (1993). Alternative ways of assessing model fit. Sage Focus Editions, 154, 136–136.
Byrne, B. (1994). Structural equation modeling with EQS and EQS/Windows: Basic concepts, applications, and programming. Thousand Oaks, CA: Sage.
Casaló, L., Flavián, C., & Guinalíu, M. (2008). The role of satisfaction and website usability in developing customer loyalty and positive word-of-mouth in the e-banking services. International Journal of Bank Marketing, 26(6), 399–417.
Chen, S., Chen, H., & Chen, M. (2009). Determinants of satisfaction and continuance intention towards self-service technologies. Industrial Management & Data Systems, 109(9), 1248–1263.
Chironga, M., Cunha, L., De Grandis, H., & Kuyoro, M. (2018). Roaring to life: Growth and innovation in African Retail Banking. Johannesburg, South Africa: McKinsey & Company. Retrieved from https://www. mckinsey.com/~/media/McKinsey/Industries/Financial%20Services/Our%20Insights/African%20retail%20bankings%20next%20growth%20frontier/Roaring-to-life-growth-and-innovation-in-African-retail-banking-web-final.ashx
Commonwealth Bank of Australia. (2017). Initial submission to the productivity commission’s inquiry into competition in the Australian Financial System. Retrieved from https://www.pc.gov.au/data/assets/ pdf_file/0010/221869/sub025-financial-system.pdf
Davis, F. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly, 13(3), 319–340.
De Jong, A., De Ruyter, K., & Lemmink, J. (2003). The adoption of information technology by self-managing service teams. Journal of Service Research, 6(2), 162–179.
Donner, J., & Tellez, C. (2008). Mobile banking and economic development: Linking adoption, impact, and use. Asian Journal of Communication, 18(4), 318–332.
Dupas, P., Green, S., Keats, A., & Robinson, J. (2012). Challenges in banking the rural poor: Evidence from Kenya's western province (Paper No. 17851). Cambridge: National Bureau of Economic Research. Retrieved from https://www.nber.org/papers/w17851
Gandhi, A., & Sheorey, P. (2017). Mobile banking adoption in a developing country like India. Drishtikon: A Management Journal, 8(2), 29–42.
George, A., & Kumar, G. (2013). Antecedents of customer satisfaction in internet banking: Technology acceptance model (TAM) redefined. Global Business Review, 14(4), 627–638.
Godoe, P., & Johansen, T. (2012). Understanding adoption of new technologies: Technology readiness and technology acceptance as an integrated concept. Journal of European Psychology Students, 3(1), 38–52. DOI: https://doi.org/10.5334/jeps.aq
Gu, J., Lee, S., & Suh, Y. (2009). Determinants of behavioral intention to mobile banking. Expert Systems with Applications, 36(9), 11605–11616.
Hu, L., & Bentler, P. (1998). Fit indices in covariance structure modeling: Sensitivity to under parameterized model misspecification. Psychological Methods, 3(4), 424–453.
Karahanna, E., & Straub, D. (1999). The psychological origins of perceived usefulness and ease-of-use. Information & Management, 35(4), 237–250.
Khadka, R., & Kohsuwan, P. (2018). Understanding consumers' mobile banking adoption in Germany: An integrated technology readiness and acceptance model (TRAM) Perspective. Catalyst, 18, 56–67.
Kitapci, O., Dortyol, I., Yaman, Z., & Gulmez, M. (2013). The paths from service quality dimensions to customer loyalty: An application on supermarket customers. Management Research Review, 36(3), 239–255.
Koksal, M. (2016). The intentions of Lebanese consumers to adopt mobile banking. International Journal of Bank Marketing, 34(3), 327–346.
Laforet, S., & Li, X. (2005). Consumers’ attitudes towards online and mobile banking in China. International Journal of Bank Marketing, 23(5), 362–380.
Liao, C., Tsou, C., & Huang, M. (2007). Factors influencing the usage of 3G mobile services in Taiwan. Online Information Review, 31(6), 759–774.
Lin, C., & Lu, H. (2000). Towards an understanding of the behavioural intention to use a web site. International Journal of Information Management, 20(3), 197–208.
Lin, C., Shih, H., Sher, P., & Wang, Y. (2005, July). Consumer adoption of e-service: Integrating technology readiness with the technology acceptance model. Paper presented at Technology Management A Unifying Discipline for Melting the Boundaries Conference, 31 July–4 August 2005 (pp. 483–488). Portland, USA: IEEE.
Littell, R., Henry, P., & Ammerman, C. (1998). Statistical analysis of repeated measures data using SAS procedures. Journal of Animal Science, 76(4), 1216–1231.
Lomax, R., & Schumacker, R. (2004). A beginner's guide to structural equation modeling (2nd ed.). New York: Psychology Press.
Luarn, P., & Lin, H. (2005). Toward an understanding of the behavioral intention to use mobile banking. Computers in Human Behavior, 21(6), 873–891.
Manica, L., & Vescovi, M. (2009). Mobile telephony in Kenya… Is it Making the life better? University of Trento. Retrievied from https://www.researchgate.net/publication/228900464_Mobile_ Telephony_in _Kenya_ is_it_Making_the_life_better
Marsh, H., Balla, J., & Hau, K. (1996). An evaluation of incremental fit indices: A clarification of mathematical and empirical properties. In G. A. Marcoulides, & R. E. Schumacker (Eds.), Advanced structural equation modeling: Issues and techniques, (pp. 315–353). Mahwah, NJ: Lawrence Erlbaum.
Maurer, B. (2008). Retail electronic payments systems for value transfers in the developing world. Department of Anthropology, University of California, Irvine. Retrieved from https://www.anthro.uci.edu/ faculty_bios/maurer/Maurer-Electronic_payment_systems.pdf
Mbiti, I., & Weil, D. (2011). Mobile banking: The impact of M-Pesa in Kenya, (Working Paper No. 2011–13). Brown University, Department of Economics, Providence, RI Retrieved from https://www.econstor.eu/ bitstream/10419/62662/1/668481188.pdf
Medhi, I., Ratan, A., & Toyama, K. (2009). Mobile-banking adoption and usage by low-literate, low-income users in the developing world. Paper presented at International conference on internationalization, design and global development. Springer, Berlin, Heidelberg. Retrieved from https://doi.org/10.1007/978-3-642-02767-3_54
Moon, J., W., & Kim, Y. (2001). Extending the TAM for a world-wide-web context. Information & Management, 38(4), 217–230.
Ndirangu, L., & Nyamongo, E. (2014). Financial innovations and their implications for monetary policy in Kenya. Journal of African Economies, 24(1), i46–i71.
Ngugi, B., Pelowski, M., & Ogembo, J. (2010). M‐pesa: A case study of the critical early adopters’ role in the rapid adoption of mobile money banking in Kenya. The Electronic Journal of Information Systems in Developing Countries, 43(1), 1–16.
Odera, E. (2013). Mobile banking adoption in the banking industry in Kenya. University of Nairobi 2013 (Unpublished manuscript), Department of Business Administration, University of Nairobi, Kenya. Retrieved from https://chss.uonbi.ac.ke/sites/default/files/chss/ESTHER%20A.%20OUKO%20ODERA% 20D61 -71319-2008_0.pdf
Oliver, R. (1999). Whence consumer loyalty? Journal of marketing, 63(1), 33–44.
Oliver, R. (1981). Measurement and evaluation of satisfaction processes in retail settings. Journal of Retailing, 57(3), 25–48.
Özbek, V., Alnıaçık, Ü., Koc, F., Akkılıç, M., & Kaş, E. (2014). The impact of personality on technology acceptance: A study on smart phone users. Procedia-Social and Behavioral Sciences, 150, 541–551.
Parasuraman, A. (2000). Technology Readiness Index (TRI): A multiple-item scale to measure readiness to embrace new technologies. Journal of Service Research, 2(4), 307-320.
Parasuraman, A., & Colby, C. (2015). An updated and streamlined technology readiness index: TRI 2.0. Journal of Service Research, 18(1), 59-74.
Quoquab, F., Abdullah, N., & Mohammad, J. (2016). Investigating the effects of consumer innovativeness, service quality and service switching costs on service loyalty in the mobile phone service context. Gadjah Mada International Journal of Business, 18(1), 21–53.
Schutt, R. (2018). Investigating the social world: The process and practice of research (9th ed.). Thousand Oaks, CA: Sage Publications
Talukder, M., Quazi, A., & Sathye, M. (2014). Mobile phone banking usage behaviour: An Australian perspective. Australasian Accounting, Business and Finance Journal, 8(4), 83–104.
Tsikriktsis, N. (2004). A technology readiness-based taxonomy of customers: A replication and extension. Journal of Service Research, 7(1), 42–52.
Ullman, J., & Bentler, P. (2003). Structural equation modeling. In J. A. Schinka & W. F. Velicer (Eds.), Handbook of psychology: Research methods in psychology, Vol. 2, pp. 607–634. Hoboken, NJ, US: John Wiley & Sons Inc.
Venable Telecommunications and Financial Services. (2008). Mobile Banking. White Paper of November. Retrieved from https://www.venable.com/-/media/files/publications/2008/11/mobile-banking/files/ mobile-banking/fileattachment/2010.pdf
Walczuch, R., Lemmink, J., & Streukens, S. (2007). The effect of service employees’ technology readiness on technology acceptance. Information & Management, 44(2), 206–215.
Ward, S., Chitty, B., & Graham, G. (2007). Finding the tutorial I want: An examination of factors leading to adoption of online self service technology. In Proceedings of the ANZMAC Conference 2007, Otago, Dunedin, New Zealand, 2580–2587. Retrieved from https://conferences.anzmac.org/ANZMAC2007/ papers.html.
World Bank. (2017). Commercial bank branches (per 100,000 adults). Retrieved from https://data.worldbank. org/indicator/fb.cbk.brch.p5
Yang, Z., & Peterson, R. (2004). Customer perceived value, satisfaction, and loyalty: The role of switching costs. Psychology & Marketing, 21(10), 799-822.