Effects Of Perceived Risk And Bank Reputation Through Online Trust On The Use Of Internet Banking Services

Abstract

Success in online banking services relies on customers’ trust. While other studies have examined factors affecting online trust, few have researched on the effects of their perceived risk and their perceived bank reputation on the use of Internet banking services through online trust. The current study attempts to fill this gap. Specifically, we analyzed (1) the extent to which the perceived risk and the bank reputation affect the use of Internet banking services through online trust, and (2) the extent to which the bank reputation affects the perceived risk. 416 samples of the Internet banking users returned their questionnaires. The model was assessed and verified using the confirmatory factor analysis (CFA) and the structural equation modeling (SEM). The analysis confirmed the significant effects of the perceived risk and the bank reputation on the use of the services through online trust, yet, the effect of the bank reputation on the perceived risk was not significant. In addition to extending theoretical insights into the Internet banking users’ online trust is significantly explained by both of the perceived risk and the bank reputation.