Customers' Perceived Risk and Trust in Using Mobile Money Services—an Empirical Study of Ghana

Customers' Perceived Risk and Trust in Using Mobile Money Services—an Empirical Study of Ghana

Ibn Kailan Abdul-Hamid (University of Professional Studies, Accra, Ghana), Aijaz A. Shaikh (University of Jyväskylä, Jyväskylä, Finland), Henry Boateng (University of Technology Sydney, Ultimo, Australia) and Robert E. Hinson (University of Ghana and University of the Free State Business School, Accra, Ghana)
Copyright: © 2019 |Pages: 19
DOI: 10.4018/IJEBR.2019010101

Abstract

Although mobile money (MM) has been explored in the existing literature, the roles of trust and risk in MM use have received little attention from researchers. Furthermore, many of the existing studies have treated these constructs as unidimensional. The extant literature also shows that perceived risk has received little attention from researchers who have conducted studies on MM. Thus, the objective of this study is to examine the roles of trust and perceived risk in customers' intent to adopt MM services in Ghana. Both trust and perceived risk were broken down into various dimensions. The study involved 671 respondents who were selected via an intercept approach and an online survey. Structural equation modelling was used to test the study's hypotheses. The findings show that perceived risk is negatively associated with customers' intent to use MM services and economy-based trust. Trust in service providers and economy-based trust are positively associated with customers' intent to use MM services. The implications of the findings are provided in the latter part of this study.
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Theoretical Background And Literature Review

MM Services

MM involves the use of mobile phones to access financial services remotely that have typically been provided over a counter (Mothobi & Grzybowski, 2017). MM services largely include transfers and payments. MM is also referred to as cell phone banking, over-the-counter banking, agent banking and branchless banking (Diniz et al., 2012).

The weaknesses of traditional and other electronic banking channels (ATMs and online banking) in fulfilling customers’ financial needs and requirements due to limited availability, week internet connectivity and other access issues may be the reason for the increasing popularity of MM services.

MM services are a novel way of accessing and conducting low-cost financial transactions. Unlike other digital banking channels, MM services operate at the intersection of finance and telecom and involve a diverse set of stakeholders with competing players from various fields (Donovan, 2012). Among these stakeholders or actors, MM agents (individuals or firms who operate mobile money services) are at the frontline of MM service deployment and play a decisive role in the success of MM services in Ghana and elsewhere.

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