Article Preview
TopIntroduction
Digitalisation of life forms the ways of business operations as well as consumer behaviours in this new technological era. Nowadays, smartphones have become one of the prominent products that are inseparable with people’s daily lives. According to Malaysia Digital Economy Corporation (MDEC), the total number of smartphone users in Malaysia was reported as 20.9 million in 2018. Meanwhile, the penetration rate per 100 inhabitants of the mobile-cellular was 134.2% in 2019 (Statistics Department MCMC, 2019). With the growing penetration of smartphones, e-wallets are expected to bring the next material step in transit to a cashless society (Apanasevic, 2013). Hence, the cash payment will gradually be replaced by the digital wallet while it becomes a new payment method in the global trend. For a while, e-wallet has become a revolutionary way to facilitate payment transactions (Santine, 2017).
E-wallet is an electronic wallet which is an application or web service that enables users to access and manage their online account information in one central location; such as logins, passwords, shipping addresses and credit card numbers (Salah Uddin, 2014). It acts as a prepaid account and prevents the need to keep keying in account details while payments are made. It will make purchases quicker once the customer has registered and created an e-wallet profile (Ray, 2017). The bank account can link with the e-wallet, which is a convenient service for the consumers. The money in the bank can be deposited in the e-wallet and top up automatically when the balance falls under the amount set by the user.
Furthermore, the major advantage for the users is that they can get a seamless one-stop shopping experience whereby they can position orders, redeem discounts, receive reward points, reload cards and make purchases in-store without ever needing to leave an app (Santine, 2017). Consequently, e-wallets are able to promote the efficiency of business operation as well as increase customer satisfaction. As a result, e-wallets become a new trend in this technology generation and move the community towards a cashless society. Since Malaysia is approaching a cashless society, this research was conducted in Malaysia to investigate consumers' behaviour toward adopting e-wallets.
Problem Statement
Malaysia's national bank set out objectives to move to an electronic payment system as a crucial stage towards accomplishing a cashless society with modernised financial services and improved effectiveness in its Financial Sector Blueprint 2011-2020. According to the Malaysia Fintech Report 2019, the smartphone and internet penetration rate of Malaysia 2019 were 75.9% and 86%. With relatively high internet penetration rate, the e-commerce market is going to expand and is anticipated to develop at a compound yearly growth rate of 24% a year (Morgan, 2019). As indicated by the Department of Statistics Malaysia, revenue from e-commerce transactions between 2015 to 2017 has increased by 6% annually over the two years, with nearly RM50 billion increment in income (Kiong, 2019).
The ascent of e-commerce and the expanding prevalence of mobile devices such as tablets and smartphones have revolutionised the retail payment landscape and empowered new approaches for making payments, one of which is by utilising e-money (Lee, 2018). Based on the statistics provided by Bank Negara Malaysia (BNM), e-money topped out at RM39.1 billion between 2014 to 2018 with a transaction volume that passed eight billion in the previous five-year period. The use of e-money has soared over the most recent five years, arriving at a staggering RM40 billion as mobile wallets become the new standard in Malaysia (Yunus, 2019). Consequently, one of the e-money instruments, e-wallet, is getting widely accepted as a payment option for parking fees, tolls, bills, groceries, food deliveries and so on.
In recent years, the interest to provide mobile payment services in Malaysia has been increased dramatically. Based on the data from the Central Bank of Malaysia, the number of approved non-bank e-money issuers had risen from 25 to 44 within 2016 and 2018 (Lee & Khaw, 2018). The 44 licensed e-money issuers assist cashless society in Malaysia, such as Touch'n Go, Grab Pay, WeChat Pay, Boost, Maybank e-Wallet, etc. Thus, the e-wallet industry must concern the factors affecting the behaviour of consumer towards e-wallet adoption.