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The advancement of communication and information technology in general and mobile and wireless Internet technology in particular are changing business activities of service providers (Liebana-Cabanillas & Alonso-Dos-Santos, 2017; Long & Thanh, 2016; Long & Vy, 2016; Long et al., 2011; Pham et al., 2018a; Pham et al., 2018b; Pham et al., 2019a; Pham et al., 2019b). The banking industry is no exception (Luo et al., 2010; Pham & Doan, 2014; Pham et al., 2013) where these technologies are revolutionizing interactions between customers and the bank (Hanafizadeh & Khedmatgozar, 2012). Customers can now interact with the bank anytime, anywhere through a mobile device connected to the wireless Internet (e.g., smartphone, tablet, or personal digital support - PDA) (Changchit et al., 2018). With mobile banking, customers can check their account balances, make transfers, pay bills, or participate in financial investment activities at their convenience regardless of their location (Hanafizadeh et al., 2014).
Since buying a smartphone is not too expensive and using smartphones is becoming more and more popular, the number of smartphone users has increased exponentially over time (Park & Tussyadiah, 2017). With the use of cell phones so ubiquitous, it would be reasonable to expect the number of mobile banking users employing these devices to have expanded dramatically as well (Marinkovic & Kalinic, 2017). However, the reality is that numerous factors are hindering customers' intention to use mobile banking, including customer perceived risk in using this technology to perform personal banking transactions (Zhou, 2011).
As a new form of e-commerce development, mobile banking is transforming online banking (Luo et al., 2010) and has become one of e-commerce’s most popular services (Oliveira et al., 2016; Yang et al., 2004). The added convenience of mobile banking stands in contrast with traditional banking which is characterized by direct interactions between customers and the bank’s employees at the bank’s physical branches. Online banking is characterized by interactions between customers and the bank’s website via Internet-connected desktops (Jun & Cai, 2001). But with this lack of personal interaction comes the assumption that the level of perceived risk in the online banking setting is higher than that of the traditional banking setting (Hanafizadeh & Khedmatgozar, 2012). Customers face risks involving security risk and privacy issues (Lee et al., 2007).
Perceived risk in mobile banking refers to a transaction situation in which potential distrust and uncertainty can lead to negative outcomes, thus hindering customer mobile banking acceptance (Luo et al., 2010). With mobile banking, customers are not required to go to the bank’s branches to interact with the bank’s employees. Consequently, customers’ most basic visual cues to believe in successful transactions are missing. Customers feel that they do not have adequate control in such transactions (Lee et al., 2007).
Perceived risk may come from different sources such as from the bank itself, from the telecommunications companies that provide wireless Internet services, or from mobile devices (Lim, 2003). Should serious problems arise from these sources, the negative outcomes for customers can be significant (Brown et al., 2003).