Exploring the Factors Affecting the Adoption of Mobile Financial Services among the Rural Under-banked and its implications for Micro-finance Institutions

Around two and half billion adults worldwide do not have a savings or credit account with either a traditional (regulated bank) or alternative financial institution (such as a microfinance institution). On the other hand, penetration of mobile technology had been substantial in the past few years and is expected to increase in the future. Around one billion people in emerging markets have a mobile phone but no access to banking services and it is said that by 2012 this population will reach 1.7 billion. Financial institutions, which have had difficulty providing profitable services through traditional channels to poor clients, see mobile financial services (MFS) as a form of \u27branchless banking\u27, which lowers the costs of serving low-income customers. The main objective of this study was to determine the factors affecting the adoption of MFS (including mobile banking and mobile payments) among the rural under-banked population that would help the micro-finance institutions like credit cooperative societies to reach to more people with better quality of services

Adoption of Mobile Financial Services among Rural Under-Banked

During the last decade, there has been tremendous growth in mobile penetration in many countries across the globe and most interestingly in a number of developing countries. On the other hand around, half of the world’s population is deprived of banking and financial services. This paper is based on a study that was aimed to identify drivers and inhibitors for adoption of MFS among the rural under-banked population and to compare the same with that of the existing studies. During the study, an extensive review of literature was conducted to identify the factors that were studied and found significantly affecting the adoption of mobile financial services. This was followed by an exploratory qualitative research conducted among the rural under-banked population of three distinct states in India. The findings of the study indicate that the demand for banking and financial services and the amount of hardships faced in availing these services through the existing channels of delivery can act as strong drivers for MFS adoption among the rural under-banked. On the other hand, factors like lack of trust on technology and lack of technology readiness were found to act as barriers to the adoption of MFS.

Adoption Factors For Mobile Financial Services: Laggards And Early Adopters In Low-Income Countries

This paper evaluated low-income countries and identified adoption factors for mobile financial services (MFS) that are not covered by TAM (Technology Acceptance Model). From the literature we identified enabler and bottleneck factors that impact MFS adoption in low-income countries. We analyzed laggard and early adaptor countries to compare the factors. In our conclusion we identified thirteen MFS adoption factors and categorized them in a 2x2 metrics using enablers and bottlenecks vs. exogenous and endogenous. Further, we used the early adopter and laggard countries to understand how the MFS adoption strategy differed between the two groups. Future direction is provided

A Meta Analysis on Adoption of Mobile Financial Services

During the last decade, there has been tremendous growth in mobile penetration in many countries across the globe including a number of developing countries. The total number of mobile subscription 5 billion by the end of 2010 and is further expected to grow multi-folds. On the other hand, around 2.5 billion adults worldwide do not have a savings or credit account with either a regulated bank or alternative financial institution (such as a microfinance institution). Around one billion people in emerging markets have a mobile phone but no access to banking services. This scenario has opened immense opportunities for organizations including banks, insurance companies and telecom operators to strengthen their customer base and increase revenue by providing various financial services to the consumers through mobile technology. Hence, it becomes very important to understand the factors that would act as drivers or inhibitors towards the adoption of mobile financial services (MFS). Quite a few studies have been conducted across the globe to determine the factors affecting adoption of MFS. This paper provides a Meta analysis of the existing academic literature on MFS and determines the strength of the factors and their linkages through a scoring model based on the type of publication. The findings of the study would be beneficial for further research in understanding the dimensions to be considered for developing adoption model for MFS. The findings can also be used by the practitioners involved in MFS in understanding the factors affecting demand for such services.

Factors influencing the adoption of mobile financial services in the unbanked population

To deliver financial services to the poor has remained a challenge for many decades. However, the growth of technology has emerged as a key solution of financial service delivery to the poor. Financial services delivery through mobile phone platforms can be provided where formal financial institution like banks cannot reach. Despite these developments, the use of these services by the poor in the unbanked areas is very low. This study investigated the factors influencing the adoption of mobile financial services in the unbanked population. We employed a cross-sectional design by collecting data at a single point in time. We used six variables in the study based on the Technology Acceptance Model, TAM. The variables were Perceived usefulness, Perceived ease of use, Perceived trust, Perceived cost, Perceived risk and Social influence. The construct validity of the measurement items was established by using confirmatory factor analysis conducted using Structural Equation Modelling (SEM) and the reliability was established by using Cronbach’s Alpha coefficient. The hypothesis was tested by using multiple regression analysis. The sample size used was 250 respondents selected from the study area. The study revealed that perceived usefulness, perceived cost and social influence had a significant influence on the adoption of mobile financial services. Perceived ease of use, perceived risk and perceived trust were found to have an insignificant influence on the adoption of mobile financial services. The implication of the findings forms the basis for product or service development, pricing, marketing and policy formulation. In this study we recommend a longitudinal research to be conducted in order to understand the influences of the adoption behaviour at different level of market maturity and points of time.Keywords: Mobile financial services, Adoption, Tanzani

Facilitating mCommerce growth in Nigeria through mMoney usage: A preliminary analysis

A general belief is that Mobile Money (mMoney) has the catalytic effect of spurring mCommerce growth and driving financial inclusion in developing nations like Nigeria. In Nigeria, mMoney service is certainly a new financial service innovation in the country, and as a result critical issues surrounding its early critical mass adoption, including its perceived usefulness, remain largely opaque. In this paper, our aim was to explore factors influencing perceived usefulness of mMoney by using the extended technology acceptance model (TAM) as the theoretical underpinning of our work. This work is based on a usable sample of 127 respondents from two major cities in Nigeria. Overall, the study's results indicate that perceived regulator assurance, service affordability, convenience, proximity to the nearest bank branch, and worry over ease of use are significant predictors of mMoney perceived usefulness. The work helps shed new insights about the significant factors that are closely related to the consumer's perception of the relevance of mMoney services (to his/her financial needs). In sum, the study is an initial step to addressing the issue of perceived usefulness of mMoney service, including its pivotal importance to laying a solid foundation for mCommerce growth in Nigeria and similar sub-Saharan African (SSA) countries

The impact of mfinance initiatives in the global south: a review of the literature

After more than two decades of research on technological interventions in the transition to information societies, the burgeoning of mobile phones in developing countries has shifted the information and communication technologies for development (ICT4D) research lens to the different domains of mDevelopment. While advances have been made in domains of mHealth, mGovernment, mBusiness and mEducation, mFinance initiatives have had impressive adoption upon implementation in certain geographic locations. Services such as M-Pesa have been widely reported in the mainstream press and form the test beds for various scholarly investigations

Mobile Banking: A Study on Adoption by Indian Users

Mobile Banking is one of the highly discussed topics of the times, with the exponential growth of mobile phones over the years and a teledensity of around 80% Banks are trying their best to enhance adoption of banking though mobile phones. Today with Mobile banking penetration of around 3% there is a huge market to be tapped in the country. With the burgeoning population the brick & mortar model of banking is difficult to pace with and Bankers are harping large on the adoption of mobile banking providing traditional banking to all would be too costly and may not be feasible. The review paper delves into the aspects of low mobile banking penetration and the factors impacting the adoption of Mobile banking in India, despite the high Teledensity & 49% Bank Penetration. Self efficacy, Apps compatibility, 24x7 hours availability have been found to build perception towards “Ease of Use”. Efficient transaction and Transaction cost, as primary factors leading to perception of “Usefulness” Privacy Risk & Transaction Risk have been found to be the primary factors leading to Risk Perception and accordingly influencing the adoption decision. The study proposes a model which is built upon the Technology Acceptance Model TAM. The findings from the study would provide the stakeholders in the Mobile banking domain with a better understanding of customer perceptions of mobile banking services and help them plan their marketing strategies and promotion approaches for mobile banking services in the future. Keywords: Mobile Banking, TAM, online banking, Smartphone banking, Banking penetration, TA

Mobile Banking Adoption in the United States: Adapting mobile banking features from low - income countries

This is a work-in-progress research paper on Mobile Banking (mBanking) in the USA that draws upon mBanking deployment successes in low-income countries. The research investigates mBanking adoption at a large (over 24,000 students) university in the southeast United States, with plans to collect data from low-income countries (Ghana, Kenya, and Ethiopia). The completed study will compare the results from the USA to those in low-income countries with a view to developing a theoretical framework that compares US adoption patterns to those in low-income countries. The paper has three objectives: identification of the core mBanking features evidenced in the dominant mBanking solutions within low-income countries, identification of a theoretical framework for mBanking use, and an empirical study to understand the adoption of mBanking in the US as contrasted to its adoption in the low-income countries. We borrow from Internet banking studies and adapt a theoretical framework for mBanking use. We conduct surveys and interviews to empirically test our theoretical model. We identify common mBanking features from solution providers in low-income countries and apply it to our target population in the US. In January 2011 the United States’ Federal Deposit Insurance Corporation (FDIC), as a major part of its economic inclusion campaign to reach out to the unbanked and under-banked communities, sponsored nine banks to launch economic inclusion program for the seventeen million unbanked and forty-three million under-banked residents in the United States (Corporation 2011). Students are part of these sixty million people that make up the unbanked and under-banked US residents. Students aren’t building the credit history needed to get loans and often are unable to take advantage of the less costly forms of financial products. There are similarities between low-income countries and the unbanked and under-banked communities in the US. Hence, this study looks at common mBanking features in low - income countries and tests to see their likely adoption in the US