Structural Models for E-Banking Adoption in Vietnam

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Keywords: BankImage,DecomposedofTheoryofPlannedBehavior,E-Banking,E-BankingAdoption,PerceivedRisk,TechnologyAcceptance,TheoryofPlannedBehavior,TheoryofReasonedAction,Trust

INTRODUCTION

Banking can be considered an intensive in-formation activity based on communication and information technologies for the purpose of gaining, processing and distributing in-

formation to users involved (Keramati et al., 2012; Srinivasan, 2010; Sufian, 2010). Such technologies play an important role not only in the three stages of information (Smolander, 2010), but also in creating favorable conditions for banks to differentiate their products and services from their rivals (Yan et al., 2012). In order to be successful in a highly competi-tive banking market, it is required that banks

Structural Models for E-Banking Adoption in Vietnam

LongPham,DepartmentofBusinessAdministration,CollegeofBusiness,MinotStateUniversity,Minot,ND,USA;&SchoolofBankingandFinance,NationalEconomics

University,Hanoi,Vietnam

NhiY.Cao,DepartmentofFinancialandMonetaryTheory,SchoolofBankingandFinance,NationalEconomicsUniversity,Hanoi,Vietnam

ThanhD.Nguyen,DepartmentofManagementInformationSystem,HoChiMinhCityUniversityofTechnology,HoChiMinh,Vietnam

PhongT.Tran,DepartmentofCommercialBank,SchoolofBankingandFinance,NationalEconomicsUniversity,Hanoi,Vietnam

ABSTRACTE-bankingisseenasthenewestdeliverychannelforbankingservicesinmanydevelopedcountriesandisbelievedtohaveasignificantimpactonthebankmarket.E-bankingisprovidingnumerousopportunitiesforbanksandnon-bankfinancialinstitutionstoaddalowcostdistributionchanneltotheirexistentdistributionchannels.Littleresearchonfactorsinfluencingtheadoptionofe-bankinghasbeenimplementedincountrieswithveryhigheconomicgrowthrates(suchasVietnam)thatareemergingasnewpotentialmarkets.Thus,thisstudyhas,basedonanextensiveliteraturereviewone-bankingbenefitsforbothbanksandtheircustom-ersandrelevanttheoriesoninnovationadoption,proposedalternativemodels(includingbothmoderatorandmediatingeffects)ofe-bankingintentiontousebycustomersinVietnam.Furthermore,asetofmodelhypothesespresentingrelationshipsamongfactorsinfluencinge-bankingintentiontousehavebeensetup.Practicalimplicationsandfuturestudieswerealsodiscussed.

DOI: 10.4018/jeis.2013010102

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innovate and update their products/services offered in an attempt to retain their demanding and discerning customers (Pham, 2010). Facing challenges related to gaining a larger share of the banking market, a number of banks have been making significant investments in building more brick and mortar branches to expand their geographical penetration, while others have been utilizing the Internet to distribute banking products/services (Schubert et al., 2011). In the 1990’s, the Internet rapidly gained popularity as a potential medium for electronic commerce (Crede, 1995). Rapid growth of the Internet has brought about numerous new opportunities as well as threats to businesses (Cruz-Cunha & Putnik, 2009). Today, the Internet is believed to be a full-fledged delivery and distribution channel supporting consumer-oriented applica-tions (Mouakket, 2010; Pham & Teich, 2011; Varajao et al., 2009), including those aimed at effectively and efficiently providing financial products and services to customers in the bank-ing sector (Pham, 2010).

In the US, banks have been offering their services/products to customers via the Internet and a number of Internet banks, such as Bank of Internet, have emerged. In addition, the Internet is viewed as a strategic weapon that is expected to bring about new comparative advantages for banks, especially when competitive advantages of traditional branch networks are rapidly erod-ing (Seitz & Stickel, 1998) and brick and mortar only banks may largely disappear.

Indeed, the emergence of e-banking has induced many banks to rethink their infor-mation technology strategies in order to stay competitive (O’Connor & Arteaga, 2008). It should be noted that customers are today increas-ingly demanding with respect to the quality of banking services. They want better levels of convenience and flexibility with banking prod-ucts and services that traditional retail banking could not offer (Lagoutte, 1996). E-banking has made favorable conditions for banks and other

financial institutions to offer such products and services by taking advantage of an extensive public network infrastructure (Ternullo, 1997). However, in spite of such potential benefits, there still exist a number of problems that need to be dealt with before e-banking can become widely adopted (Pham, 2010).

Up to now, a great deal of literature has identified key factors influencing the adoption of e-banking in developed countries – North America and Europe and to a lesser extent in other regions including a mix of developed and developing countries, such as Singapore, Taiwan, Malaysia, and Thailand (Pham, 2010). However, little research on factors influencing the adoption of e-banking has been implemented in countries that are emerging as new potential markets with very high economic growth rates. Among these countries is Vietnam where its average economic growth rate (GDP) was over 7% during the 1990s and early 2000s, and more than 8% in 2006, which made it one of the highest growing economies in the World (World Bank, 2006). Together with Vietnam’s entry into the World Trade Organization dated on 7 November 2006, its banking sector is increasingly being deregulated in accordance with the requirements set up by the World Trade Organization. These moves create the opportu-nity for fierce competition among local banks and foreign banks, and Vietnamese banks may have to adopt the Internet as a primary service delivery channel in order to survive. Thus, the objectives of this study are as follows:

1. Investigate e-banking benefits for both banks and customers;

2. Conduct an extensive review of literature on relevant theories on adoption of an in-novation; and finally;

3. Construct alternative structural models based on integration of the tenets of inno-vation theories, trust, perceived risk, bank

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image, and perceived benefit for e-banking adoption in Vietnam.

BACKGROUND

E-Banking

E-banking can be considered as a high-order construct comprising several distribution chan-nels. E-banking is a larger concept than just banking conducted by the Internet. Nonetheless, the most popular kind of e-banking is today believed to be banking through the Internet - Internet banking. In its simplest sense, e-banking is viewed as the provision of information or services by a bank to its customers based on a computer, television, telephone, or mobile phone (Daniel, 1999). For instance, under the view of Jun and Cai (2001), Internet banking is seen as an electronic connection between banks and customers aimed at preparing, managing, and controlling numerous financial transactions. By utilizing e-banking, it is very convenient for consumers to access their banks and accounts to implement their banking transactions. In a more sophisticated view, e-banking is named transactional online banking due to the fact that it embeds the provision of facilities, such as ac-cessing accounts, transfer of funds, and buying financial products or services online (Sathye, 1999). In this paper, without loss of generality, the terms e-banking and online banking (or even Internet banking) are used interchangeably.

E-banking is seen as the newest delivery channel of banks in many developed countries and is believed to have a significant impact on the banking market (Jayawardhena & Foley, 2000). Nehmzow (1997) contends that e-banking is providing numerous opportunities for banks and non-bank financial institutions to add a low cost distribution channel to their existent distribution channels in order to bet-ter serve their customers. However, he further contends that e-banking also brings about chal-lenges to traditional banks because it neutralizes competitive advantages rooted in a traditional banking network.

It is predicted that e-banking will continue mushrooming and this trend may impact the future of traditional banks (Pham, 2010). Ac-cording to Wah (1999), it is not reasonable to say that such traditional banks are likely to disappear in the near future. Rather, they will be placed on a new level of banking services/products with the support of new and modern distribution channel technologies. Furthermore, Wah (1999) argues that traditional banks can take advantage of new and modern technolo-gies and they are very likely to effectively and efficiently serve their customers. Finally, Wah (1999) concludes that e-banking is really beneficial to customers and that e-banking and traditional banking can coexist.

E-Banking’s Benefits

For Banks

Cost savings, efficiency, gaining new segments of customers, improvement of the bank’s reputation and better customer services and satisfaction are primary benefits e-banking may bring to banks (Jayawardhena & Foley, 2000). Booz-Allen and Hamilton (1997) argue, based on their global survey, that setting up a special-ized e-banking infrastructure costs about US$1 – 2 million, which is much lower than setting up a banking branch. In addition, the authors conclude that costs for running a traditional bank account for 50% to 60% of its revenues.

According to Robinson (2000), costs for conducting a banking transaction online are much lower than at a brick and mortar branch. Moreover, Sheshunoff (2000) contends that one of the most important factors influencing the adoption of e-banking by banks is the need to build up strong barriers to customer exiting. According to Sheshunoff (2000), once custom-ers become familiar with the utilization of full service e-banking, it is unlikely that they will change to another financial institution. Such an argument can be supported by the consumer behavior theory that switching costs (e.g., time and effort) are often very high. Finally, the author emphasizes that the implementation of

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e-banking can bring about many competitive advantages for banks in today’s highly competi-tive banking market.

Research on e-banking has been carried out in Denmark by Mols (1998). The author argues that e-banking can play an important role in en-hancing cross-selling and price differentiation. E-banking allows banks to provide customers numerous services 24 hours a day and 7 days a week and so can improve customer satisfac-tion. This in turn makes customers less price sensitive, improves their intention to repurchase, increases customer loyalty and results in more positive words of mouth.

For Customers

E-banking not only brings about benefits to banks but also to their customers. Thanks to the emergence of the Internet, banking transactions are no longer limited to time and geography. It is very easy for consumers throughout the world to have access to their bank accounts 24 hours per day and seven days a week even from the privacy of their own home. Customers can enjoy a variety of services, including services not provided by traditional bank branches. It is argued that one of the greatest benefits of e-banking is that e-banking products/services are inexpensive or may even be free and that customers save even more money as well as time because they do not have to travel to or from a bank branch (Pham, 2010). However, some people believe that prices appear to be one factor that impedes the diffusion of e-banking (Sathye, 1999). The price debates revolve around geo-graphical differences between costs of Internet connections and telephone call pricing.

STRUCTURAL MODELS FOR E-BANKING ADOPTION IN VIETNAM

International Studies of Consumer Adoption of E-Banking

Banks implementing e-banking services may benefit by better understanding their custom-

ers’ attitudes towards technology. If banks are successful in doing so, they may be able to positively impact and even determine con-sumer behavior, thereby gaining a competitive advantage. There have been so far a significant number of discussions in the literature about the adoption process of e-banking services. The Appendix summarizes the results of such studies. These research studies utilized theory of planned behavior (TPB), theory of reasoned action (TRA), technology acceptance model (TAM), and decomposed theory of planned behavior (DTPB) to investigate the e-banking adoption construct. However, such studies have not examined any moderating effects on the relationship between perceived benefit and intention to use.

A Conceptual Model for E-Banking Adoption in Vietnam

Based on an integration of the innovation theories, trust, perceived risk, bank image, and perceived benefit, a conceptual model for e-banking adoption in Vietnam is built in Figure 1.

The following are theoretical support and resulting hypotheses that elicit causal relation-ships postulated in the model.

Corporate image refers to the extent to which reputational knowledge of an organiza-tion has been accumulated and developed by customers. Such a reputational knowledge is rooted in the minds of the customers. Specifi-cally, reputational knowledge can be represented by a distinctive reputation by a firm in offer-ing products/services with very high quality (Olavarrieta and Friedmann, 1999). Gronroos (1984) argues that corporate image is very likely to make significant contributions to the devel-opment of service quality. Image is believed to function well to overcome complexities generated by distinct attributes of service and when small problems occur from functional and technical aspects of quality. In addition, the results of a study conducted by Kang and James (2004) revealed that corporate image plays as a mediator between service quality dimensions and the overall service quality, and

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the overall service quality is positively related to customer loyalty.

Furthermore, corporate image can be un-derstood as customers’ affective preconceptions towards the service provider, accumulated and developed via continuous service experiences (Zins, 2001). Based on this definition, a bank image plays a vital role in the adoption of e-banking. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 1: Bank image will have a posi-tive direct relationship with intention to use e-banking.

An e-banking transaction is considered as a mode of trusting behavior due to the fact that customers are themselves engaging in vulnerable situations regarding such e-banking transactions. Customers are willing to utilize e-banking as long as they believe that e-banking functions well and performs what they expect it to do.

In e-settings, people from almost every-where in the world are easily to get access to documents stored on computers and in the same vein, information is easily to be transferred through e-technologies with computer net-works. That is why under the security perspec-tive, e-banking is considered as being risky. In

addition, e-banking is characterized by highly uncertain transactions since people who make such transactions very often come from dif-ferent places in the world. The utilization of e-banking can be considered as a new informa-tion and communication technology and under the marketing perspective, it is also viewed as a new distribution channel technology based on which customers can easily contact with their bank. In the marketing field, a number of empirical studies have been conducted to show that perceived risk is a very important construct (Gefen, 2004). In such studies, perceived risk is shown to have significant effects on customer loyalty. Thus, under Vietnam’s e-banking set-ting, we hypothesize that:

Hypothesis 2: Perceived risk will have a nega-tive direct relationship with intention to use e-banking.

Perceived benefit is, in the literature of tech-nology acceptance, defined as an individual’s positive or negative evaluation of performing a type of behavior (Chau & Hu, 2001). Hansen et al. (2004) found a significantly positive associa-tion between perceived benefit and behavioral intention to use online shopping for groceries. Similarly, other prior research has indicated that perceived benefit has strong impacts on

Figure1.Aconceptualmodelfore-bankingadoptioninVietnam

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behavioral intention to utilize an innovation, for example, word processing software (David et al., 1989) or spreadsheet software (Mathieson, 1991). If someone has a feeling that utilizing e-banking will bring about positive outcomes, then such a person may have more intention to adopt e-banking. In contrast, if someone has a negative feeling of outcomes resulting from utilizing e-banking, he or she may have a lower adoption intention. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 3: Perceived benefit will have a positive direct relationship with intention to use e-banking.

Subjective norms refer to the person’s per-ception that most people who are important to him think that he should or should not perform the behavior in question (Ajzen & Fishbein, 1980). Several theories suggest that subjective norms are important in shaping user behavior. For example, TPB suggests that subjective norms influence a person’s behavioral intention. Venkatesh and Davis (2000) explain the effect of subjective norms on behavioral intention to use in the way that potential users may choose to use the technology if the people who are important to them say that they should use it. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 4: Subjective norms will have a positive direct relationship with intention to use e-banking.

Trust has been shown to have a mediating role in IS adoption models (Gefen et al., 2003; Ribbink et al., 2004; Chen & Dhillon, 2003; Jarvenpaa et al., 2000; Rotter, 1971). Trust plays an important role in many transactional buyer-seller relationships, especially in settings containing risks (McKnight et al., 1998). It is argued that trust serves a critical role under online business settings where it is impossible to have face-to-face interaction with staff. In

general, trust can be defined as an expectation one has that others will not behave opportu-nistically. Alternatively, trust can be defined as one’s belief that others are going to behave in a dependable, ethical, and socially desirable manner (Rousseau et al., 1998). Moreover, trust can be conceptualized as a combination of such factors as trustworthiness, integrity, honesty, and benevolence of e-vendors that are expected to escalate behavioral intentions via reduced risks among potential but inexperienced customers (Jarvenpaa & Todd, 1996; Gefen et al., 2003). Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 5: Trust will have a positive direct relationship with intention to use e-banking.

The relationship between trust and per-ceived benefit has been widely discussed in a variety of contexts including online based busi-ness settings (Gefen et al., 2003; Pavlou, 2003; Saeed et al., 2003; Gefen, 2004). Specifically, trust and TAM is well integrated in the online shopping setting (Gefen et al., 2003). Such an integration showed that trust is an antecedent of perceived benefit. Trust is contended to serve as an important determinant of perceived ben-efit, especially in the online environment due in part to the guarantee that consumers expect the perceived benefit from the website with the sellers behind it. Furthermore, trust is strongly believed to have positive impacts on perceived benefit on the ground that trust makes favorable conditions for consumers to be vulnerable to e-vendor to ensure that they achieve expected useful interactions and services (Pavlou, 2003). While consumers initially trust their e-vendors and have a feeling that online service adoption is efficient to their job performance, they intend to believe that such online services are useful (Gefen et al., 2003). Thus, under Vietnam’s e-banking setting, we hypothesize that:

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Hypothesis 6: Trust will have a positive direct relationship with perceived benefit.

Many studies have been conducted and found that there is a strongly positive correla-tion between users’ and IS units’ mutual trust and mutual influence (Nelson & Cooprider, 1996). Moreover, it is elicited by Decomposed TPB that users can be influenced by their peers and superiors in determining subjective norm towards the IS utilization (Taylor & Todd, 1995). To put it another way, it is very possible that trust in peers and superiors regarding their beliefs of the IS utilization plays an important role in determining subjective norm. In a similar vein, trust in e-vendors regarding their reputation, brand name, and service might have positive impacts on subjective norm over online transactions’ behavior. Additionally, aspects of reputation, brand name, and service might elicit certain relationships between trust in peers and superiors and trust in vendors. Hence, whatever types of trust are with direct and indirect im-pacts on subjective norm, they are all serving as important antecedents of subjective norm in the online setting. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 7: Trust will have a positive direct relationship with subjective norms.

The relationship between perceived ease of use and perceived benefit can be explained in the manner that if other things are equal, the easier the technology is to use, the more beneficial it can be (Venkatesh & Davis, 2000). If using the technology is easy, potential users do not have to spend too much time to learn how to use the technology; this may influence the performance of the user. Besides, TAM has verified the effects of perceived ease of use on perceived benefit (David, 1989; David et al., 1989). Extensive research has shown significant effects of perceived ease of use

on perceived benefit (e.g., Chan & Lu, 2004). Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 8: Perceived ease of use will have a positive direct relationship with perceived benefit.

Perceived ease of use is, in many studies, found to have positive impacts on trust since perceived ease of use is very likely to escalate customers’ favorable impressions towards e-vendors in the online service initial adop-tion and lead customers to be willing to make investments and commitments in buyer-seller relationships (Gefen et al., 2003). Under the view of social cognitive theory, perceived ease of use is strongly contended to have positive impacts on an individual’s favorable outcome expectation towards an innovative technology adoption (Bandura, 1986). Such a contention is based on the fact that cognition-based trust, as mentioned above, is primarily constructed on the first impression of the individual towards a certain behavior. Specifically, perceived ease of use under the online service setting is viewed as the first feeling or expectation set up for contin-ued online transactions. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 9: Perceived ease of use will have a positive direct relationship with trust.

Theories of reasoned action (TRA) and planned behavior (TPB) and their derivatives have been utilized to predict possible adoption of information technology (Benbasat and Barki, 2007). While such studies have escalated our understanding of how the theories’ main con-tructs have effects on IT adoption, they ignore nonlinear relationships among the constructs. The fact that ignoring the nonlinear effects is very likely to either understate or overstate the main effects which might lead to erroneous,

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partial, or incomplete interpretations (Ping, 2002). That is the reason Ping (2002) strongly argue that investigating complicated and con-tingent relationships among the main constructs will bring about finer grained knowledge about determinants of individual IT adoption. Thus, under Vietnam’s e-banking setting, we hypothesize that:

Hypothesis 10: The relationship between perceived benefit and intention to use e-banking will be positively moderated by perceived ease of use.

Hypothesis 11: The relationship between perceived benefit and intention to use e-banking will be positively moderated by trust.

Hypothesis 12: The relationship between perceived benefit and intention to use e-banking will be positively moderated by subjective norm.

Hypothesis 13: The relationship between perceived benefit and intention to use e-banking will be negatively moderated by perceived risk.

Hypothesis 14: The relationship between perceived benefit and intention to use e-banking will be positively moderated by bank image.

Formal Representation of the Conceptual Model

The research hypotheses can be integrated to form a set of structural equations. Since the moderator effects of perceived ease of use, trust, subjective norm, perceived risk, and bank image on the relationship between perceived benefit and intention to use have not been clearly tested in the literature, we create six competing structural models from the conceptual model illustrated in Figure 1. Model A is without any moderator effects. Model B is Model A plus the moderator effect of perceived ease of use on the relationship between perceived benefit and intention to use. Model C is Model B plus the

moderator effect of trust. Model D is Model C plus the moderator effect of subjective norm. Model E is Model D plus the moderator effect of perceived risk. Model F is Model E plus the moderator effect of bank image. The following abbreviations are used for simplicity: bank im-age (BI), perceived risk (PR), perceived ease of use (PEU), perceived benefit (PB), trust (T), subjective norm (SN), and intention to use (IU).

Model A can be represented by Eqs. (1)-(5):

IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + e1 (1)

PB = β7(PEU) + β8(T) + e2 (2)

T = β9(PEU) + e3 (3)

SN = β10(T) + e4 (4)

To represent Model B, we modify Eqs. (1):

IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + α1(PEU*PB) + e1 (5)

Eqs. (2)-(4) are kept unchanged Model C can be represented:

IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + α1(PEU*PB) + α2(T*PB) + e1 (6)

Eqs. (2)-(4) are kept unchanged Model D can be represented:

IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + α1(PEU*PB) + α2(T*PB) + α3(SN*PB) + e1 (7)

Eqs. (2)-(4) are kept unchanged Model E can be represented:

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IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + α1(PEU*PB) + α2(T*PB) + α3(SN*PB) + α4(PR*PB) + e1 (8)

Eqs. (2)-(4) are kept unchanged Model F can be represented:

IU = β1(BI) + β2(PR) + β3(PB) + β4(SN) + β5(T) + α1(PEU*PB) + α2(T*PB) + α3(SN*PB) + α4(PR*PB) + α5(BI*PB) + e1 (9)

Eqs. (2)-(4) are kept unchanged

We suggest that these alternative structural models (Model A, Model B, Model C, Model D, Model E, and Model F) need to be tested independently and their results need to be compared and contrasted.

CONCLUSION AND DIRECTIONS FOR FUTURE RESEARCH

Up to now, a great deal of literature has iden-tified key factors influencing the adoption of e-banking in developed countries – North America and Europe and to a lesser extent in other regions including a mix of developed and developing countries, such as Singapore, Tai-wan, Malaysia, and Thailand. To put it another way, little research on factors influencing the adoption of e-banking has been implemented in countries that are emerging as new poten-tial markets with very high economic growth rates. Among these countries is Vietnam where its average economic growth rate (GDP) was over 7% during the 1990s and early 2000s, and especially more than 8% in 2006, which made it one of the highest growing economies in the World (World Bank, 2006). Together with Viet-nam’s entry into the World Trade Organization dated on 7 November 2006, its banking sector is increasingly being deregulated in accordance with the requirements set up by the World Trade

Organization. These moves seem to indicate that fierce competition among local banks and foreign banks in Vietnam have been occurring, and Vietnamese banks have to adopt the Internet as a primary service delivery channel in order to survive. However, there are no comprehensive models or frameworks to explain the e-banking adoption by customers in Vietnam.

This study has, based on an extensive re-view of literature on e-banking benefits for both banks and their customers, trust, perceived risk, bank image, and relevant theories on innova-tion adoption, proposed alternative structural models (including both moderator and mediat-ing effects) for e-banking adoption in Vietnam. Furthermore, a set of model hypotheses present-ing relationships among the factors influencing e-banking adoption have been set up.

The next step in the development of such models is to statistically test the aforemen-tioned hypotheses in the Vietnamese setting. Each of the factors identified in the previous discussion will form the basis for analysis in the empirical study of e-banking adoption in such a new context. The models presented in this paper are unique as at present, there are no comprehensive theoretical and practical models for analyzing e-banking adoption in newly emerging countries such as Vietnam. None of the prior models have taken into account the interactions between innovation theories, trust, perceived risk, bank image, and intention to use e-banking. These models can provide an impetus for future research, structuring them along the lines of interactions between such above theories and factors that will expand the frontiers of knowledge in e-banking adoption.

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LongPhamisanAssistantProfessorofBusinessAdministration,CollegeofBusiness,MinotStateUniversityinUSA.HereceivedhisPhDinManagementatNewMexicoStateUniversity.HisresearchinterestsareNegotiationAnalysis,E-negotiation,OnlineAuctions,E-commerce,E-purchasingandMultipleCriteriaDecisionMaking.LongPhamhaspublishedinjournalssuchasBusiness Studies Journal, International Journal of Entrepreneurship, Journal of International Business Research, Academy of Banking Studies JournalandInternational Journal of Enterprise Information Systems,amongothers.

NhiY.Cao isanAssistantProfessor in theDepartmentofFinancialandMonetaryTheory,SchoolofBankingandFinance,NationalEconomicsUniversity,Vietnam.She receivedherPhDinBankingandFinanceatNationalEconomicsUniversity.HerresearchinterestsareStateBank,CommercialBanksandMacroeconomicsPolicies.NhiY.CaohadarticlesreportedintheViet-Laosinternationalmeeting(2011)andpublishedinseveraljournalssuchasJournal of Economics and Development, Banking Review, Financial and Monetary Market Review, Asia - Pacific Economic Review,andJournal of Financial and Accounting Research.

ThanhD.NguyenhasworkedforCitibank,ABBank,andWesternBankinVietnam.HereceivedhisMasterinManagementInformationSystematHoChiMinhCityUniversityofTechnology.His research interests areAnalysis, E-commerce,E-banking,Banking System,ManagementInformationSystem,ProjectManagement.ThanhD.NguyenhaspublishedinScience & Tech-nology Development Journal-VietnamNationalUniversity,HoChiMinhCity.

PhongT.Tran is anAssistantProfessor in theDepartmentofCommercialBank,SchoolofBankingandFinance,NationalEconomicsUniversity,Hanoi,Vietnam.HehasexperiencesinmanagementandcoordinationofprojectssponsoredbytheWorldBank,MinistryofPlanningandInvestment,theAsianDevelopmentBank,BankforAgricultureandRuralDevelopmentofVietnam,People’sCreditFund,UnitedNationsEnvironmentProgram,andMinistryofAgricul-tureandRuralDevelopment.

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APPENDIX

Table1.Internationalstudiesone-bankingadoption

References Name of Study Models Utilized Determinants

Hussein and Zolait, 2010

An examination of the factors influencing Yeme-ni bank users’ behavioral intention to use Internet banking services

TPB (theory of planned behavior) TRA (theory of reasoned action)

+ Attitude + Subjective norm +Perceived behavioral control + Ease of use + Awareness + Advantage + Media

This study, based on a self-administered survey involving a convenience sample of 369 Yemeni bank customers, investigates the potential prominent factors relating to the adoption and use of the financial services of Internet banking in Yemen. The authors of this study show that the overall prominent predictors include Relative Advan-tage/Compatibility, User’s Informational-Based Readiness, Attitude, Observability, Technology Facilitating Condi-tion, Perceived Behavioural Control and Self-efficacy. The model accounted for 75 per cent of the variation of an individual’s behavioural intention to use IB.

Ozdemir and Trott, 2009

Exploring the adoption of a service innovation: a study of Internet banking adopters and non-adopters

TAM (technology accep-tance model) Diffusion of Innovation Theory of perceived Risk

+ Socioeconomic factors + Situational factors + Perception factors related to Internet banking use + Related experiences

Findings: The authors show that Internet banking adopters and non-adopters have different perceptual, experience-related, socioeconomic and situational characteristics. In addition, besides the perceptual factors related to Internet banking use, perceptual factors in relation to the banks in Turkey have significant impacts on Internet banking adoption.

Alhudaithy and Kitchen, 2009

Rethinking models of technology adoption for Internet banking: the role of website features

TAM TRA TPB

+ Website features

Findings: The authors show that website features have significant impacts on technology adoption, and specifically Internet banking.

Yousafzai, Pallister and Foxall, 2009

Multi-dimensional role of trust in Internet banking adoption

Model of trust for Internet banking

+ Trust + Perceived risk

Findings: The authors show that trust and perceived risk are direct antecedents of intention, and trust is a multi-dimensional construct with three antecedents: perceived trustworthiness, perceived security, and perceived privacy.

Ndubisi and Sinti, 2006

Consumer attitudes, sys-tem’s characteristics: an internet banking adoption in Malaysia

Decomposed TPB

+ Banking needs + Compatibility + Complexity + Trainability + Risk + Utilitarian orientation + Hedonic orientation

Findings: The authors show that attitudinal factors play an important role in explaining the e-banking adoption. In addition, utilitarian orientation of the website, not hedonic orientation, has significant impacts on adoption.

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References Name of Study Models Utilized Determinants

Fink et al., 2005

Internet banking adoption strategies for a develop-ing country: the case of Thailand

Decomposed TPB

+ Features of the web + Perceived usefulness + Risk and privacy + Personal preference + External environment + Culture

Findings: The authors reveal that the attitudinal factors, such as features of the website and perceived usefulness, are very likely to have positive impacts on the e-banking adoption in Thailand, while the most salient impediment to the e-banking adoption is a perceived behavioral control, or external environment. Besides such above factors, the important moderating factors are gender, educational level, income, internet experience and internet banking experience, but not age.

Eriksson, Kerem and Nils-son, 2005

Customer acceptance of internet banking in Estonia

TAM

+ Trust + Perceived usefulness + Ease of use + Use

Findings: The authors indicate that the utilization of e-bank is very likely to elevate if customers perceive e-banking as use-ful. Specifically, the perceived usefulness is very important due to the fact that it determines if the perceived ease of use of e-bank results in increased use of e-bank. In other words, e-banking services which are well-designed and easy to use might not be realized if they are not perceived as useful. Hence, the authors conclude that the perceived usefulness of e-banking plays an important role in motivating customer usage. Moreover, the authors contend that technology acceptance models need to be redesigned with more emphasis placed on the importance of the services’ perceived usefulness offered by the technology.

Pikkarainen et al., 2004

Consumer acceptance of online banking: an extension of technology acceptance model

TAM and focus group

+ Perceived usefulness + Perceived ease of use + Perceived enjoyment + Information on online banking + Security and privacy + Quality of internet con-nection

Findings: The authors conclude that perceived usefulness and information on online banking of the Website are viewed as the primary factors that are very likely to have impacts on the acceptance of online banking.

Wang, Lin and Tang, 2003Determinants of users acceptance of internet banking

TAM

+ Trust/Perceived cred-ibility + perceived usefulness + Ease of use + Computer self-efficacy + Intention

Findings: Based on the results of the study, the authors conclude that individual difference variables such as computer self-efficacy have significant effects on behavioral intention via perceived ease of use, perceived usefulness, and per-ceived credibility. In addition, the authors show that users with a higher computer-self efficacy are likely to have more positive usefulness and ease of use beliefs, but have more negative credibility beliefs in e-banking. Such results are in line with that of the prior studies which have indicated that there is a significant direct e-banking relationship between computer-self efficacy and perceived ease of use of e-banking. Finally, the authors show that computer-self efficacy has a negative impact on perceived credibility; however, its total impact on behavioral intention is positive.

Table1.Continued

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References Name of Study Models Utilized Determinants

Shih and Fang, 2003

The use of decomposed theory of planned be-havior to study internet banking in Taiwan

TPB and Decomposed TPB

+ Behavior intention + Actual usage + Attitude + Subjective norms + Perceived advantage + Relative advantage + Compatibility + Complexity + Normative influences + Efficacy + Facilitating

Findings: It is, based on the decomposed TPB model, shown in this study that only relative advantage and complexity are related to attitude, but compatibility is not related to attitude. In terms of subjective norm, the causal path starting from subjective norm to intention is not statistically significant. Nevertheless, self-efficacy is found to be a signifi-cant determinant of PBC. Finally, the authors show that facilitating conditions do not have impacts on perceived behavioral control.

Suh and Han, 2002Effects of trust on customer acceptance of internet banking

TAM

+ Trust + Perceived usefulness + Ease of use + Attitude + Intention to use

Findings: It is shown in this study that trust plays the most important role in explaining a customer’s attitude towards utiliz-ing e-banking. In line with TAM, in this study, customer perception of the usefulness and ease of use also have significant impacts on attitude. Moreover, behavioral intention to use e-banking is significantly related to attitude, perceived usefulness, and trust. Such findings elicit that trust is much emphasized by customers in e-environments with a lot of sensitive information.

Karjaluoto, Mattila and Pento, 2002

Factors underlying at-titude formation towards online banking in Finland

TAM

+ Prior computer experi-ence + Prior technological experience + Prior banking experi-ence + Reference group influ-ences

Findings: It is shown in this study that prior computer experience, prior technology experience, personal banking experience, reference group and computer attitudes have significant impacts on attitude and behavior towards e-banking. In addition, there is a significantly positive relationship between personal banking experience and attitude.

Black et al., 2001The adoption of internet financial service: a quali-tative study

Decomposed TPB

+ Relative advantage + Compatibility + Trainability + Observability + Complexity

Table1.Continued

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References Name of Study Models Utilized Determinants

Findings: The authors of this study concentrate on innovations related to delivery of financial services via the e-channels and on reassessment of Rogers’ (1983) model’s applicability. The data was colleted via the focus group members based on their usage of the internet. There are differences between people who utilize the internet to buy financial services (S3) and people who utilize the internet to buy goods/services (not financial services) (S2) in terms of income and the utilization of information technology (higher levels for S3). When S2 is compared with S1 (people who utilize the internet without buying anything over the internet), there are also differences in terms of income and the product related environment (higher levels for S2). Based on such comparisons among the three groups, it is shown that considering factors of Rogers’ model, similar attitudes exist in S1 and S2 regarding their perceived advantages by utilizing e-banking compared to utilizing bank branches and risks involved. S1 and S2 attitudes are much less positive than that of S3. In addition, compatibility with a person’s values and previous experience with the product category is proved to be one of the most important factors affecting the adoption of the internet to carry out financial transactions. Trialability is considered important for the future adoption, but its availability needs to be better communicated. In spite of the fact that Rogers’ model utilized to assess an innovation’s perceived attributes is thought of as a useful starting point, there are still other issues emerged that should be taken into consideration, such as societal issues and the sense of fatalism. It seems that the former may have a negative effect on the adoption, while the latter may have a positive effect on the adop-tion.

Tan and Teo, 2000Factors influencing the adoption of internet banking

TPB and Diffusion of Innovation

+ Relative advantages + Compatibility with values + Internet experiences + Banking needs + Complexity + Trialability + Risk + Self efficacy + Government support + Technology support + Social norms

Findings: The findings from the study uncover that factors such as attitudinal and perceived behavioral control factors, not social influence, have a significant role in influencing the intention to adopt e-banking. Specifically, perceptions of relative advantage, compatibility, trialability, and risk towards utilizing the internet have impacts on intentions to adopt e-banking services. Furthermore, the confidence in utilizing e-banking services and perception of govern-ment support for e-commerce also have impacts on intentions to adopt e-banking services.

Liao et al., 1999The adoption of virtual banking: an empirical study

TPB and Diffusion of Innovation

+ Attitude + Relative advantage + Ease of use + Compatibility + Result demonstrability + Perceived risks + Subjective norms + Belief of image + Belief of visibility + Critical mass + Perceived behavioral control + Voluntariness + Trialability + Support + Learning

Table1.Continued

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References Name of Study Models Utilized Determinants

Findings: In this study, TPB is partially utilized for the prediction of the adoption of e-banking. Nevertheless, there are four major relationships of TPB presented as the four hypotheses and three of them were tested. The first hypothesis stated that attitude towards virtual banking was dependent on relative advantage, compatibility, ease of use, result demonstrability, and perceived risk. Reliable measures on perceived risk could not be obtained and only the first four constructs were tested. The hypothesis was supported but the two factors found were not clear cut. One of them was a combination of ease of use, compatibility and result demonstrability whereas the other was a mixture of relative advantage, compatibility and result demonstrability. The explanation power of this relationship is 0.56. The second hypothesis claimed that subjective norms about virtual banking were dependent on image, visibility and critical mass. Visibility was not used as no reliable measure was available. The hypothesis was also supported. However, the R square value was only 0.29, which meant that image and critical mass alone could not provide a powerful explanation of subjective norms. The third hypothesis was that perceived behavioral control about virtual banking was dependent on voluntariness, trialability, support and organizational learning. However, this hypothesis could not be tested in this study due to an unavailable reliable measure. The last hypothesis stated that intention to use virtual banking was determined by attitude, subjective norms and perceived behavioral control. Dependency on subjective norms could not be tested due to the absence of reliable measure. Dependency on the other two factors was founded statistically significant. Nevertheless, the low R square value of 0.056 indicated very low explanation power.

Sathye, 1999Adoption of internet banking by Australian consumers

TPB and Diffusion of Innovation

+ Security concerns + Ease of use + Awareness of service and its benefits + Reasonable price + Resistance to change + Availability of infra-structure

Findings: The author of this study reveals that security concerns and lack of awareness about e-banking and its benefits are considered as the main impediments to the adoption of e-banking in Australia.

Table1.Continued