Adoption and Diffusion of Internet Banking

Abstract

This chapter reviews important theories?the diffusion of innovations theory, the theory of planned behavior, and the technology acceptance model?in information systems that explain the adoption and diffusion of new technological innovations especially in the context of Internet banking. These theories taken together provide us with psychological models that influence the adoption of a new delivery channel for banks, that is, Internet banking. Empirical works that have investigated these theories are discussed. A critical perspective is offered that highlights the theoretical and methodological limitations of these models. Newer and richer models that take into account the socio-historic contexts of technology adoption are called for. Approaches that complement or challenge positivistic methodologies that are interpretive are presented in a case study. Relating theory to practice this chapter discusses possible future trends in Internet banking that could make an attempt to include populations that are not included in the modern electronic formal mainstream financial systems.