The role of information in mobile banking resistance

The role of information in mobilebanking resistance

Tommi LaukkanenDepartment of Business, University of Eastern Finland, Joensuu, Finland, and

Vesa KiviniemiIT-Centre, University of Eastern Finland, Kuopio, Finland

Abstract

Purpose – Adopting technological service innovations entails substantial learning effort requiringinformation and guidance from the provider. The purpose of this paper is to investigate the effect ofinformation and guidance offered by a bank on five adoption barriers – usage, value, risk, tradition,and image – in a mobile banking context.

Design/methodology/approach – The measurement development and hypotheses were based onconsumer resistance theory and the earlier literature on internet and mobile banking. A large empiricalstudy on bank customers with 1,551 effective observations was conducted. The measure items werevalidated by measurement model and hypotheses were tested using structural equation modelling.

Findings – The results show that the information and guidance offered by a bank has the mostsignificant effect on decreasing the usage barrier, followed by image, value and risk barriersrespectively. The information and guidance showed no effect on the tradition barrier.

Originality/value – This paper provides further understanding of how the information andguidance of a bank affect consumer attitudes and resistance in particular, on mobile banking. It alsohas implications for management in overcoming resistance to mobile banking.

Keywords Innovation, Consumer behaviour, Information management, Mobile communication systems,Banking

Paper type Research paper

IntroductionThere is rationale for being positive that mobile banking can take off in the foreseeablefuture, but from the consumer perspective there are some barriers still to overcome.Knowledge intensive innovations, like technological innovations, often entailconsiderable learning effort from the consumer (Saaksjarvi, 2003). Thus, theinnovation adoption process imposes change on the consumer, and resistance tochange is a normal consumer response to innovations (Ram, 1987, 1989). Earlierliterature on innovations has largely suffered from pro-change bias (Ram, 1987; Rogers,2003; Sheth, 1981) assuming that all innovations are always good and should beadopted by all members of a social system (Rogers, 2003). This refers to the modernistthinking of rational consumer always searching for more and more efficient ways topractise. Consequently a large number of the studies in the field have aimed to exploretechnology acceptance, time of adoption, adopter categories, and the rate of innovationdiffusion. However, in the present post-modern conditions like fragmentation of themarkets and loss of commitment by consumers, we need alternative methods tounderstand and predict consumer behaviour.

Although the above mentioned studies provide crucial contribution to thetechnology adoption, it seems that resistance to innovations and those individuals who

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International Journal of BankMarketingVol. 28 No. 5, 2010pp. 372-388q Emerald Group Publishing Limited0265-2323DOI 10.1108/02652321011064890

resist change are overlooked or have received inadequate attention. As marketers weneed to realise that a decision not to buy is a real consumption choice. Understandingthe reasons for this behaviour could be vital in the successful development,implementation and marketing of innovations as it is argued that adoption only beginsafter a consumer has overcome the initial resistance to the innovation (Ram, 1987).Therefore, there is always some resistance before adoption or the ultimate rejectiondecision (Kuisma et al., 2007), but adoption and resistance can also coexist (Ram, 1987).In order to overcome the resistance, we need to identify the sources of resistance anddevelop strategies to reduce that resistance. Rogers (2003) argues that one must focuson the communication process to understand changes caused, for instance, by aninnovation. In the context of innovations, communicability refers to the ease withwhich the benefits of the product can be demonstrated to consumers, and the lower thecommunicability of an innovation, the higher the innovation resistance is likely to be(Ram, 1987). Earlier literature has claimed that in case of banking technologies, forexample, some non-adopters have suffered from lack of information (Kuisma et al.,2007), knowledge (Gerrard et al., 2006), and training (Kuisma et al., 2007; Mattila et al.,2003).

The main object of our study is therefore to explore how information about aninnovation affects consumer resistance to the innovation in terms of five barriers,namely usage, value, risk, tradition, and image derived from earlier literature. Morespecifically our focus is on mobile banking services which provide true mobility,ubiquity, and temporal and spatial flexibility to the service consumption, but which arestill marginally adopted. The contribution of the study is therefore twofold: to focus onmobile banking which is a less researched context among financial services, and tolean on innovation resistance theory which is largely a neglected perspective inadoption and diffusion literature.

The remainder of this paper is structured as follows. First, by recapping the earlierliterature we discuss the reasons that may cause resistance to mobile banking adoptionand consequently build hypotheses for our study. Thereafter, the data and methodsused are presented. Finally, we provide the results of the study, draw conclusions, andpresent the implications for management.

Prior research and hypotheses developmentMobile services and their consumption have lately become a burning issue amonginformation systems (IS) and marketing scholars (Wang et al., 2006). At the same timemany service providers are making substantial investments to take advantage of thebusiness opportunities offered by wireless technology. It seems that deliveringvalue-added mobile services to customers is becoming increasingly important ingaining a competitive edge in the marketplace (Wang et al., 2006). In the financialservices sector, for example, mobile banking represents an additional service forcertain occasions adding the element of true mobility to internet banking used overfixed networks. Thus, we define mobile banking as:

[. . .] an interaction in which a customer is connected to a bank via a mobile device such as cellphone, smartphone or personal digital assistant (PDA).

It has to be noted that the interaction does not necessarily need to involve transactionslike bill paying, money transfer between accounts or stock exchange, as mobile

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banking can, in its simplest form, be only an SMS request of an account balance, forexample. However, from the perspective of banks that develop mobile banking, a greatnumber of customers should use these services in order to produce a return oninvestment (Lee and Chung, 2009). Therefore, it has been argued that whereas todayinternet banking services provide huge economic benefits for the banks, mobileservices serve rather as a way to offer customers value added (Laukkanen et al., 2007).

The value of mobile banking for consumers is in its immediate location-free accessto banking services enabling time savings, real-time information, and enhancedfeelings of control (Laukkanen and Lauronen, 2005). The services today enable bankcustomers, for example, to request their account balance and the latest transactions oftheir accounts, to transfer funds between accounts, to make buy and sell orders on thestock exchange and to receive portfolio and price information. However, while internetbanking innovation has diffused well in many countries and recent studies indicatehigh user satisfaction (e.g. Pikkarainen et al., 2006) it appears that a number ofconsumers are not yet willing to adopt or frequently use mobile banking services.

To explore different barriers to mobile banking adoption among bank customers werelied on the seminal work by Ram and Sheth (1989) in which they present a theoreticalframework for consumer resistance. They suggest two core resistance constructs –functional and psychological. They further categorise three constructs namely usagebarrier, value barrier, and risk barrier among the functional barriers, and twoconstructs, namely tradition barrier and image barrier among the psychologicalbarriers. This framework has been applied in some of the earlier studies regardingbanking technologies (Fain and Roberts, 1997; Laukkanen et al., 2007, 2008, 2009; Cruzet al., 2009) and is therefore considered suitable for this study also.

Prior research has shown that some internet banking non-users feel that they havenot received enough information from the bank and so suffer from lack of knowledge(Gerrard et al., 2006; Kuisma et al., 2007) and training (Kuisma et al., 2007; Mattila et al.,2003) concerning the innovation. This might well also be the case in mobile banking, sowe expect that information about the service has a decreasing effect on the adoptionbarriers (Figure 1).

The usage barrierRam and Sheth (1989) suggest that among functional barriers the usage barrier comesinto operation when an innovation is not compatible with existing workflows, practicesor habits. In the context of technological innovations, however, this construct is

Figure 1.Research model andhypotheses

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comparable to complexity which, according to Rogers (2003), refers to the degree towhich an individual considers an innovation to be relatively difficult to understand anduse. As a part of the TAM model ease-of-use represents the degree to which anindividual considers an innovation to be free of effort (Davis et al., 1989). This conceptclosely corresponds to the concept of complexity (Davis, 1989; Teo and Pok, 2003; Wuand Wang, 2005) and is also relative to the usage barrier.

In the mobile banking context the small size of mobile devices including smallscreens and tiny multifunction keypads may be troublesome to use and impair theusability of the service. Indeed, it has been argued that the reason behind the belateddissemination of mobile banking is in the system limitations, such as tiny screens andkeypads and slower transaction speeds, compared to computer based internet banking(Lee and Chung, 2009). Earlier studies show that smaller screens appear adequate ininformation-based mobile services, like requesting account balance, but those bankingservices involving transactions require a bigger screen size (Laukkanen, 2007a). Forexample, some bank customers consider bill payment via mobile phone to be difficultand time consuming as the device enables only a limited amount of informationprocessing and hence, the whole bill is not visible on the display inhibiting the progressin the service process (Laukkanen, 2007b; Laukkanen and Lauronen, 2005). However,significant differences in channel attribute preferences exist between users andnon-users of mobile banking (Laukkanen, 2007c). Moreover, some studies highlight theimportance of simple authorisation mechanisms in internet banking and reportinconvenience due to changing PIN codes among some bank customers as the codesneed to be carried along (Kuisma et al., 2007).

The usage barrier mainly implies the role of functional usability of an innovation.Earlier studies show that those reporting functional resistance to banking technologiesappear to be more dissatisfied with the information and guidance offered by the bankthan others, and suggest careful one-to-one customer education from the serviceprovider in order to decrease the resistance (Laukkanen et al., 2009). Consequently wehypothesise:

H1. Information and guidance offered by the bank has a negative effect on theusage barrier.

The value barrierThe value barrier refers to the performance and monetary value of an innovation incomparison to its substitutes (Ram and Sheth, 1989). This concept is related to Rogers’(2003) concept of relative advantage defined as the perceived superiority of aninnovation to the product or service it follows. Then again, relative advantage issimilar to the concept of perceived usefulness (Wu and Wang, 2005) which refers to anindividual’s perception that using a specific innovation improves his/her performance(Davis et al., 1989). Consequently, Brown et al. (2003) showed that the greater theperceived advantage that mobile banking offers over other ways of banking, the morelikely mobile banking is to be adopted. One such advantage is the option to check themovements or transactions of an account wherever wanted, increasing customers’feeling of control over their financial affairs (Laukkanen and Lauronen, 2005).However, if an innovation does not offer superior performance to existing alternatives,it is not worthwhile for consumers to change their behaviour (Ram and Sheth, 1989).For example, financial cost considerations, i.e. the extent to which an individual


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believes that using mobile banking is uneconomical, have been found to have anegative effect on the intention to use mobile banking (Luarn and Lin, 2005).

The value barrier, for its part, can be lowered by providing significant performancevalue and value-for-money over existing alternatives (Ram and Sheth, 1989).Consequently, Gerrard et al. (2006) suggest that by educational programs describingthe advantages of internet banking banks could influence those customers whocurrently see no need to use internet banking services. Thus we hypothesise:

H2. Information and guidance offered by the bank has a negative effect on thevalue barrier.

The risk barrierThe theory of perceived risk has been applied to explain consumer behavior anddecision-making since the 1960s (Taylor, 1974). In recent decades the definition ofperceived risk has changed as people have engaged in online transactions. Initiallyperceived risk was primarily related to fraud or product quality, but today perceivedrisk is related to financial, psychological, physical, or social risks in online transactions(Forsythe and Shi, 2003; Im et al., 2008).

Following Ram and Sheth (1989) the risk barrier refers to the degree of risks inherentin an innovation. These risk perceptions usually arise due to the uncertainty related tothe degree of discrepancies between people’s judgements and actual behaviour, i.e. if atechnology fails to deliver its expected outcome, it will cause loss to the user (Im et al.,2008). Dunphy and Herbig (1995) note that the diffusion of innovation usually takeslonger the more risk adverse the innovation is. The prior research on mobile banking andother banking technologies has identified different types of risks. Firstly, there appear tobe privacy and security concerns regarding mobile banking among some consumers(Luarn and Lin, 2005). A portable list of PIN codes may also pose security threats as thelist may be lost (Kuisma et al., 2007). For instance, Poon (2008) report that some bankcustomers fear that the hackers may get access to their bank account via PIN numbers.Indeed, safety measures of personal details and financial information are one of thecritical factors for the success of mobile banking (Brown et al., 2003), especially amongmature consumers (Laukkanen et al., 2007).

Second, reliability referring to the “degree to which a person believes a newtechnology will perform a job consistently and accurately” is an extremely importantrisk-related factor in technology-based financial service innovations (Lee et al., 2003).Mobile phones, for example, may be limited in computational power, memory capacityand battery life, limiting the use of mobile services (Siau and Shen, 2003).

Finally, self-efficacy is evinced as a major risk factor predicting resistance totechnological innovations (Ellen et al., 1991). It refers to the confidence the individualhas in his/her ability to use a specific technology (Agarwal et al., 2000). Ellen et al.(1991) argue that when faced with an alternative that the individual feels less capableof handling, he/she may resist the alternative due to feelings of inadequacy ordiscomfort possibly arising from the anticipated change. In mobile banking the datainput and output mechanisms may hinder the individual’s confidence to use the serviceas some consumers appear to be afraid that they may make mistakes when conductingtheir bank affairs via a mobile phone (Laukkanen, 2007b; Laukkanen and Lauronen,2005). Consequently, in their mobile banking study Luarn and Lin (2005) definedperceived self-efficacy as the assessment of one’s ability to use mobile banking.

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Lee and Chung (2009) state that it is in the best interest of mobile banking serviceproviders to gain the trust of their customers. They argue that providing reliable andappropriate information are effective ways of gaining the trust of customers.Therefore, we hypothesise:

H3. Information and guidance offered by the bank has a negative effect on the riskbarrier.

The tradition barrierFunctional and technical issues do not provide a comprehensive explanation toinnovation resistance. It has been noted that some satisfaction/dissatisfaction withelectronic financial services is not tied to the technology itself, but rather to the type ofpersonality (Srijumpa et al., 2002). For example, if there is a desire or sensed need forpersonal contact, willingness to adopt technology-enabled service delivery is lower(Walker et al., 2002). Tradition and image barriers are more often created throughconflicts with customers’ prior beliefs and values than actual usage of the innovation(Ram and Sheth, 1989). These mental traits of consumers are associated to a broaderdiscussion in literature about technology readiness, referring to customers’ mentalreadiness to accept new technologies (Parasuraman, 2000).

Those innovations that are inconsistent with values and require changes in traditionsand lifestyles are most likely to be resisted by consumers (Dunphy and Herbig, 1995).Thus, the tradition barrier arises when an innovation is incompatible with an individual’sexisting values, norms and past experience (Ram and Sheth, 1989), and may block theadoption of the innovation (Rogers, 2003). The tradition barrier appears to be conceptuallyrelated to the concept of compatibility from the theory of innovation diffusion.

In the online banking context the tradition barrier may arise, for example, if anindividual perceives online banking to be very different from the way he/she has beenaccustomed to paying bills (Fain and Roberts, 1997). Alternatively, a customer mayneed social interaction and enjoy talking to bank personnel, and complain that internetbanking lacks a social dimension in terms of human interaction (Gerrard et al., 2006;Mattila et al., 2003). Prior research has shown that a strong desire to deal with humantellers may discourage an individual from adopting self-service technologies inbanking (Marr and Prendergast, 1993) and lack of human contact may causedissatisfaction in internet financial services (Srijumpa et al., 2002, 2007). It may be thatin mobile banking the tradition barrier arises if consumers simply prefer to dealdirectly with the bank clerk instead of using new banking technologies.

Psychological resistance, derived from the traditions of consumers could be brokendown, for instance, by using change agents (Ram and Sheth, 1989). Laukkanen et al.(2009) suggest that marketer should take the role of a change agent by usingface-to-face contact to have a great personal influence on consumers and theirtraditions. Consequently we hypothesise:

H4. Information and guidance offered by the bank has a negative effect on thetradition barrier.

The image barrierAs innovations attain a certain identity from their origins, such as the product categoryto which they belong, the unfavourable associations regarding these identities give rise


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to the image barrier (Ram and Sheth, 1989). This is a highly perceptual issue of anindividual and in the case of technological innovations, for example, may derive fromnegative image of a new technology in general and of a product class such as mobilebanking in particular. In the late 1990s Fain and Roberts (1997) stated that the imagebarrier in online banking emerges from a negative hard-to-use image of computers andthe internet. This is related to so-called anxiety towards computers (Kay, 1993) andnegative state of mind about technology tools (Meuter et al., 2003). This may also be thecase in mobile banking today as some consumers may perceive the mobile technologyto be too difficult to use and therefore instantly form a negative image of the servicerelated to the technology. We suggest that information and guidance from the bank hasa decreasing effect also on the image barrier. Thus we hypothesise:

H5. Information and guidance offered by the bank has a negative effect on theimage barrier.

Ram and Sheth (1989) divided the five adoption barriers into functional andpsychological. Therefore, in addition to H1-H5, we assume that the functional barriersincluding the usage, value and risk barriers are correlated. We likewise assume that thepsychological barriers including tradition and image barriers are correlated.

Empirical studyWe tested our hypotheses using data from an online survey among the internetbanking customers of a large bank in Finland. A questionnaire that was based on thetheory of innovation resistance and the existing literature on internet and mobilebanking was placed in the log-out page of the bank’s online service. Thus the samplingmethod comprised a sample of volunteers. The questionnaire was open for 72 hoursgenerating 2,060 responses in total, of which 1,551 were effective for this study, i.e.without missing values.

Measure itemsThe five adoption barriers based on the literature on innovation resistance wereexamined with 16 statements derived from prior internet and mobile banking studies.Moreover, the perceived information and guidance offered by the bank was measuredwith three statements derived from earlier studies on banking technologies. Aseven-point Likert scale ranging from totally disagree (1) to totally agree (7) was usedin all statements. The measure items with related literature are shown in Table I.

Data analysisIn the data analysis phase the scales of positively formed statements were inverted sothat the scales of all statements were comparable; consequently the higher the mean ofa statement, the higher the resistance of the respondent. In addition, the model wasspecified according to that presented in Figure 1 and following the hypotheses settingsdefined. Following Anderson and Gerbing (1988), a two-step approach was utilised.First, the reliability of the measurement instrument was examined using themeasurement model that specifies the relationship of latent variables and observedindicators. Thereafter, the hypotheses were tested using structural equation modelling(SEM). The typical steps, including model specification and identification, parameterestimation, hypotheses testing and model fit examination, were taken into the

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Construct Measure item Internet/mobile banking literature

Usage barrier In my opinion, mobile banking services areeasy to use (2 )In my opinion, the use of mobile bankingservices is convenient (2 )In my opinion, mobile banking services arefast to use (2 )In my opinion, progress in mobile bankingservices is clear (2 )The use of changing PIN codes in mobilebanking services is convenient (2 )

Kuisma et al. (2007)Laukkanen (2007a, b)Laukkanen and Lauronen (2005)Lee and Chung, 2009

Value barrier The use of mobile banking services iseconomical (2 )In my opinion, mobile banking does notoffer any advantage compared to handlingmy financial matters in other waysIn my opinion, the use of mobile bankingservices increases my ability to control myfinancial matters by myself (2 )

Brown et al. (2003)Laukkanen and Lauronen (2005)Luarn and Lin (2005)

Risk barrier I fear that while I am paying a bill by mobilephone, I might make mistakes since thecorrectness of the inputted information isdifficult to check from the screenI fear that while I am using mobile bankingservices, the battery of the mobile phone willrun out or the connection will otherwise belostI fear that while I am using a mobilebanking service, I might tap out theinformation of the bill wronglyI fear that the list of PIN codes may be lostand end up in the wrong hands

Brown et al. (2003)Kuisma et al. (2007)Laukkanen (2007b)Laukkanen and Lauronen (2005)Lee et al. (2003)Luarn and Lin (2005)Poon (2008)

Tradition barrier Patronising in the banking office andchatting with the teller is a nice occasion ona weekdayI find self-service alternatives more pleasantthan personal customer service (2 )

Fain and Roberts (1997)Gerrard et al. (2006)Marr and Prendergast (1993)Mattila et al. (2003)Srijumpa et al. (2002, 2007)

Image barrier In my opinion, new technology is often toocomplicated to be usefulI have such an image that mobile bankingservices are difficult to use

Fain and Roberts (1997)Kuisma et al. (2007)

Information In my opinion, there is enough informationavailable about mobile banking servicesI feel that the bank has guided me enoughrelated to mobile banking servicesI feel that when needed, I will get enoughguidance from the bank related to mobilebanking services

Gerrard et al. (2006)Kuisma et al. (2007)Mattila et al. (2003)

Note: (2 ) Reversed scaleTable I.

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modelling. The analysis was performed using Amos 16.0 software. In the hypothesistesting, p-values less than 0.05 were considered statistically significant.

Measurement instrument validationA six-construct measurement model was first established before modelling the structuralrelationships defined by the hypotheses. This step was done in order to confirm andvalidate the measurement instrument and to define the relations between observed andunobserved variables. Overall, the fitted measurement model provides a fairlyreasonable fit (NFI ¼ 0:95, RFI ¼ 0:93, IFI ¼ 0:95, CFI ¼ 0:95, RMSEA ¼ 0:059).Moreover, the internal consistency of the constructs, measured with Cronbach’s alpha,ranged from 0.58 to 0.94, which can be considered acceptable as Nunnally (1967)suggests that the minimally acceptable construct reliability for preliminary researchshould be in the range of 0.5 to 0.6. Composite reliabilities of the constructs ranged from0.59 to 0.96 and average variance extracted varied from 45 percent to 76 percent.Similarly, the composite reliabilities and average variance extracted can be consideredacceptable in this context although the reliability varies noticeably between theconstructs.

Discriminant validity, which is the extent to which a construct is truly distinct fromother constructs (Hair et al., 1998), was tested by comparing the AVE of each constructwith squared correlations between the constructs (Fornell and Larcker, 1981). Assuggested by Farrell (2010), CFA correlation matrix was used for assessingdiscriminant validity as a correlation matrix that does not take measurement error intoaccount may lead to misleading results. The results indicate that discriminant validityexists between constructs with one exception. It seems that discriminant validity maynot properly exist between the usage barrier and the value barrier as the AVE for valuebarrier (0.45) is lower than the squared correlation between usage barrier and valuebarrier (0.53). This indicates correlation between these two constructs. As discussedabove, the usage barrier parallels perceived ease-of-use quite closely, likewise valuebarrier parallels perceived usefulness. The earlier literature has shown that these twoconcepts, ease-of-use and usefulness, correlate with each other. Davis (1989) suggestedthat perceived ease-of-use might be an antecedent to usefulness. Later on this isverified by a number of TAM studies (e.g. Davis et al., 1989; Venkatesh and Davis,2000). Moreover, in their study on internet banking barriers Laukkanen et al. (2008)showed that the usage and value barriers are distinct constructs, as suggested by thetheory. Based on the evidence of the earlier literature these two constructs areconsidered separate in this study. However, this is taken into consideration in ourmodel as usage and value barriers are assumed to correlate. Table II presents theaverage variance extracted of the constructs and the correlations and squaredcorrelations between the constructs. Standardised loadings of the measurement modelare shown in Table III.

ResultsThe main results of the fitted model are represented in Figure 2 along with the arrowsexpressing the associations of observed and latent variables. The ovals represent latentvariables and rectangles stand for observed variables. The one-way arrows representthe directed associations and the two-way arrows describe the correlations of thevariables. The values above the arrows are standardised regression coefficients or

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correlations ranging from 21 to 1. The abbreviations, such as e1 or ef1, are error termsbelonging to the model. The parameter estimates along with the test statistics andp-values are shown in Table IV.

The parameter estimates in Figure 2 and Table IV show that the information andguidance offered by the bank is significantly negatively related to all the functionalbarriers including usage (b ¼ 20:55, p , 0:001), value (b ¼ 20:45, p , 0:001) andrisk (b ¼ 20:27, p , 0:001) barriers. Thus, H1-H3 are supported. Moreover, theresults show that the information and guidance offered by the bank also significantlylowers the image barrier (b ¼ 20:46, p , 0:001) but not the tradition barrier(b ¼ 20:05, p , 0:157). Thus, among psychological barriers the data and the findingsgive support to H5 but not to H4. The magnitudes of the effects indicate that theinformation and guidance offered by the bank has the strongest effect on decreasingthe usage barrier, while image, value and risk barriers follow in that order. Thecorrelations of functional barriers and psychological barriers were all significant asassumed. The association of usage and value barriers had the greatest magnitudeamong the correlations.

The chi-square test, testing the equality of empirical and theoretical (modelled)covariance matrices, suggests rejecting the model (p , 0:001). This can be considereda typical phenomenon with larger sample sizes due to the conservativeness of thestatistical test (Bentler and Bonnet, 1980). However, NFI ¼ 0:92, RFI ¼ 0:91,IFI ¼ 0:93, CFI ¼ 0:93, and RMSEA ¼ 0:071 suggest a fairly reasonable fit of themodel. Therefore, in the light of these fit indices the model seems to achieve areasonably good concordance with the data.

Concluding discussionEarlier literature has shown that limited supply of relevant information or possiblemisinformation is likely to discourage innovation adoption (Wilton and Pessemier,1981). Indeed, it has been argued that it is necessary that banks, for example, maketheir customers aware of the available banking technologies and explain how they addvalue relative to other ways of conducting banking services (Sathye, 1999). This paperaddressed the role of information and guidance offered by the bank in decreasingconsumer resistance to the latest innovation in banking technologies i.e. mobile

Scale Mean SD 1 2 3 4 5 6

1. Usage barrier 4.23 1.51 0.76 0.53 0.12 0.02 0.29 0.252. Value barrier 4.58 1.50 0.73 0.45 0.08 0.01 0.18 0.183. Risk barrier 4.05 1.67 0.34 0.28 0.62 0.02 0.29 0.054. Tradition barrier 3.37 1.63 0.15 0.10 0.15 0.42 0.07 0.005. Image barrier 3.40 1.66 0.54 0.42 0.54 0.26 0.62 0.146. Information 3.68 1.43 20.50 20.42 20.22 20.02 20.38 0.52Cronbach’s a 0.94 0.69 0.86 0.58 0.76 0.76Composite reliability 0.96 0.71 0.86 0.59 0.77 0.76Average variance extracted (%) 76 45 62 42 62 52

Notes: Goodness-of-fit statistics: x 2(139) ¼ 880.17, p , 0:001, NFI ¼ 0.95, RFI ¼ 0.93, IFI ¼ 0.95,CFI ¼ 0.95, RMSEA ¼ 0.059; correlations are below the diagonal, squared correlations are above thediagonal, AVE estimates are on the diagonal

Table II.Reliability and validity

statistics of theconstructs


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banking. We applied the five adoption barriers namely usage, value, risk, tradition andimage suggested by Ram and Sheth (1989) and empirically tested the effect ofinformation and guidance to the barriers using structural equation modelling (SEM).The study showed that information and guidance about mobile banking has thestrongest effect on decreasing the usage barrier followed by image, value and riskbarriers respectively. Thus, the results supported H1-H3 and H5. However, theinformation and guidance about mobile banking did not show a statistically significanteffect on the tradition barrier and thus the results did not give support to H4.

Measure items of the constructsStandardised

loadings

Usage barrierV1 In my opinion, mobile banking services are easy to use (2 ) 0.93V2 In my opinion, the use of mobile banking services is convenient (2 ) 0.94V3 In my opinion, mobile banking services are fast to use (2 ) 0.86V4 In my opinion, progress in mobile banking services is clear (2 ) 0.90V5 The use of changing PIN codes in mobile banking services is convenient (2 ) 0.72

Value barrierV6 The use of mobile banking services is economical (2 ) 0.62V7 In my opinion, mobile banking does not offer any advantage compared to

handling my financial matters in other ways 0.59V8 In my opinion, the use of mobile banking services increases my ability to

control my financial matters by myself (2 ) 0.80

Risk barrierV9 I fear that while I am paying a bill by mobile phone, I might make mistakes

since the correctness of the inputted information is difficult to check from thescreen 0.85

V10 I fear that while I am using mobile banking services, the battery of the mobilephone will run out or the connection will otherwise be lost 0.79

V11 I fear that while I am using a mobile banking service, I might tap out theinformation of the bill wrongly 0.89

V12 I fear that the list of PIN codes may be lost and end up in the wrong hands 0.58

Tradition barrierV13 Patronising in the banking office and chatting with the teller is a nice occasion

on a weekday 0.60V14 I find self-service alternatives more pleasant than personal customer service (2 ) 0.69

Image barrierV15 In my opinion, new technology is often too complicated to be useful 0.77V16 I have such an image that mobile banking services are difficult to use 0.81

InformationV17 In my opinion, there is enough information available about mobile banking

services 0.70V18 I feel that the bank has guided me enough related to mobile banking services 0.80V19 I feel that when needed, I will get enough guidance from the bank related to

mobile banking services 0.65

Note: (2 ) Reversed scale

Table III.Standardised loadings ofthe measure items

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These results suggest that the information and guidance offered by a bank has the mostsignificant effect on perceived functional usability of the innovation but also significantlyincreases the positive image associated with the innovation. The results also suggest thatinformation and guidance significantly increase the perceived value added provided bymobile banking and decrease the perceived risks related to the innovation.

In line with the literature (Ram and Sheth, 1989), our findings suggest thatfunctional barriers, including usage, value and risk, are correlated. Similarly thepsychological barriers, namely tradition and image, are correlated as expected. Toconclude, it appears that information and guidance has more influence on functionalthan psychological barriers in the mobile banking context.

Communication methods can be classified along two dimensions: extent of marketercontrol (high vs low) and type of influence on the consumer (personal vs impersonal)(Ram, 1989). In this study we focused on those communication methods and strategies

Figure 2.Structural equation model

and standardisedestimates

Effect Beta SE Standardised beta Significance

Information ! usage barrier 20.59 0.04 20.55 p , 0:001Information ! value barrier 20.58 0.05 20.45 p , 0:001Information ! risk barrier 20.27 0.03 20.27 p , 0:001Information ! tradition barrier 0.06 0.04 20.05 p ¼ 0.157Information ! image barrier 20.57 0.04 20.46 p , 0:001Usage barrier $ value barrier 0.95 0.06 0.65 p , 0:001Usage barrier $ risk barrier 0.28 0.04 0.23 p , 0:001Risk barrier $ value barrier 0.28 0.05 0.19 p , 0:001Image barrier $ tradition barrier 0.43 0.07 0.27 p , 0:001

Table IV.Summary of model

parameter estimates andtest statistics


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that are under the marketer’s control, as low control, according to Ram (1989), refers toinformation sources such as word-of-mouth, opinion leadership, government agenciesand consumer agency reports. Based on the earlier literature we developed a constructcalled Information referring to the customer perceived adequacy of the information andguidance about mobile banking offered by a service provider.

There are two broad categories of communication methods that the marketer canuse: change agents used for personal communication and mass media for impersonalcommunication (Ram, 1989). Ram (1989) states that in the case of product innovations achange agent is one who actively provides face-to-face information to potentialconsumers in order to motivate them to adopt the innovation. He suggests that themarketing firm or its representative may take on this role by actively attempting toinfluence consumers. Mass media, for its part, includes marketer-controlledcommunication methods such as advertisements, publicity releases or media reportson the positive features of the innovation (Ram, 1989).

The results of the study showed that the information and guidance a bank offershas the greatest influence on decreasing the usage barrier, which mainly implies thefunctional usability of the innovation. If a bank customer, for example, perceivesmobile banking to be difficult to use he/she needs careful one-to-one customereducation from the bank personnel. Therefore, personal communication is needed.However, the proper communication method for decreasing the value barrier might beimpersonal by using mass media or the internet service for informing customers of thevalue added the innovation offers over existing alternatives. Previous studies describethe value adding elements of mobile banking to bank customers. The studies show thatmobile banking increases efficiency and convenience in bill paying, for example, as theservice can be used wherever wanted enabling time savings and immediate reactionsto unexpected service need (Laukkanen, 2007b; Laukkanen and Lauronen, 2005).Moreover, the option to check the movements or transactions of an account whereverwanted has been found to increase customers’ feeling of control over their financialaffairs (Laukkanen and Lauronen, 2005). Banks could use this information in theircommunications to their customers.

To overcome the risk barrier mobile banking could be offered on a trial basis topotential customers (Ram and Sheth, 1989) as it is suggested that the lower the trialability of an innovation, the higher the innovation resistance is likely to be (Ram, 1987).Some banks provide a trial service in which customers can see and try out free ofcharge how the service functions without using their own accounts. From thecommunication perspective this can be considered as guiding without personalface-to-face or telephone contact.

The results showed that information and guidance had the second strongest effecton lowering the image barrier. This shows that having information and guidanceavailable and also actively providing information significantly increases the positiveimage of mobile banking. Therefore, banks should use both personal and impersonalcommunication methods in their marketing actions. Customers visiting their bankbranch could be informed about the option to bank anytime anywhere via a mobiledevice as nearly everyone today has a mobile phone in their pocket. Banks could alsomarket mobile banking for current internet banking users as a supplementary channelfor special situations. It is suggested that the most potential mobile banking usersamong internet banking customers are those with high education and good income,

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those working in a leading position, experts or entrepreneurs, and having long usageexperience and high usage frequency of internet banking (Laukkanen, 2007c).

Some limitations are evident in this study. First of all, the study is based on atheoretical framework of consumer resistance that has not been empirically tested in alarge scale. This study is one of the first attempts to empirically validate the fiveadoption barriers suggested by Ram and Sheth (1989) over 20 years ago. Even thoughsome empirical evidence exists that these adoption barriers are distinct constructs, thisappears not to be explicit. Our validity statistics suggest that the usage and valuebarriers may somewhat overlap and that their divergence is not necessarilyunequivocal. Therefore, further research is needed to verify measures of these twoconstructs.

Moreover, the data were collected using an online questionnaire that was open for72 hours in an online service of a bank. Since different people may bank online onweekdays than at weekends, placing the survey on the banking site only for thislimited time period exposed the study to a potential bias. Also, the respondents were allalready using internet banking services so their attitudes to mobile banking may differsignificantly from those who are not at all acquainted with online banking services. Inaddition, we must be careful with the generalisations of the findings as the data wascollected only among customers of a single bank in Finland. Customers of one bankmay exhibit different behavioural patterns from customers of other banks and,furthermore, Finns may show different attitudes to technologies in general, andbanking technologies in particular, than people in other countries. Finally, one morelimitation in our study is that all the constructs were measured with one surveyconducted at the same time exposing the study to common method variance problem.This problem could be excluded only by collecting data through different sources orthrough a longitudinal survey.

More research is needed to enhance the validity of the adoption barriers. Both,qualitative and quantitative research approaches in different empirical contexts arewelcome. Also cross-national studies in terms of construct validation are needed. Inaddition, the common method variance problem should also be taken into account bydesigning studies in which the data are collected through different sources or by usinglongitudinal surveys. To conclude, understanding consumer resistance as aphenomenon deserves more attention among academics and practitioners alike.

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Further reading

Heinonen, K. (2004), Time and Location as Customer Perceived Value Drivers, Economi ochSamhalle 124, Swedish School of Economics and Business Administration, Helsinki.

Corresponding authorTommi Laukkanen can be contacted at: [email protected]

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