Prognosticating the Drivers and Inhibitors on Adoption Intention to the Future Digital Banking in Malaysia

Chong, Roxzana Len Yin (2024) Prognosticating the Drivers and Inhibitors on Adoption Intention to the Future Digital Banking in Malaysia. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

The banking sector has swiftly transitioned from physical to virtual realms, driven by digital banking’s innovative and technological advancements. There is a notable surge in digital banking usage in the post-pandemic environment, especially among younger borrowers with limited financial knowledge. However, concerns about cyber threats, data security, and trust issues persist due to open banking practices and the proliferation of non-banking players in fintech. Continuous innovation remains crucial for banks to remain competitive in the evolving digital landscape. This study investigates adoption intention predictors namely Inherent Novelty Seek, Gamification, Attitude, Negative Word-of-Mouth, Technophobia, and Risk Barrier. The analysis on direct/indirect relationships and gender differences among 417 digital savvy Malaysians are conducted with SPSS 25.0 and SmartPLS 4.0. The result reveals that drivers and inhibitors co-exist, with Attitude and Risk Barrier as strong predictors and mediators for digital banking Adoption Intention. Specifically, Attitude mediates Inherent Novelty Seek to Adoption Intention; Attitude mediates Gamification to Adoption Intention. On the other hand, Risk Barrier mediates Negative Word-of-Mouth to Adoption Intention; Risk Barrier mediates Technophobia to Adoption Intention. Gender does not moderate any relationship in this study. The findings provide valuable insights for digital banks, highlighting the positive impact of inherent novelty seek and gamification on customer attitudes, driving adoption intention. Marketers can target novelty seekers with innovative digital banking products featuring gamification. The study enriches existing literature and diversifies theories of digital banking adoption intention (Dual Factor Theory, Stimulus-Response-Outcome Theory, Belief-Attitude-Intention Model and partial Innovation Resistance Theory)