Abstract
The current study was conducted with the primary objective to explore the factors and analyse their relevance and importance in the adoption of internet banking in Saudi Arabia. In this paper, we gathered evidence from 300 consumers about the factors they considered important before opting for internet banking. Responses were collected by administering a Likert scale close ended structured questionnaire. Factor analysis was conducted to group the factors into significant components areas. The results showed that the factors under study explained 91.508% of the variance in internet banking adoption. Also, that the trust is the most crucial factor for the consumers of internet banking (25.950% variance) followed by ease of using internet banking services (25.188% variance); whereas 21.921% variance explained efficiency and effectiveness of the internet banking and 18.449% variance explained the importance of information about the internet banking to the consumers. The findings of this study will allow the banks to develop internet banking strategies tailored to the expectations of their clients. The study recommends banks to focus on building the trust of the customers and should also make internet banking as convenient as possible. Besides, the internet banking should be efficient and effective in delivering banking services. Furthermore, there should be sufficient information available regarding internet banking. Saudi Arabia is the largest economy in the Middle East. Of late the country has focused on the modernisation of its economy and has been trying in earnest to integrate with the world economy. The e-commerce activities are also growing; however, research in internet banking is limited. The findings of the paper can serve as a model for the adoption of internet banking especially in Saudi Arabia and in the Middle East or elsewhere in general. The research was conducted in Saudi Arabia, and more researches could be conducted based on this study in other parts of the Middle East for more generalisation of the findings.
Highlights
Internet banking refers to the use of a bank’s website through which customers access their banking accounts, conduct financial transactions, and obtain general information on bank products and services
This research paper aims to analyse the factors that play an essential role in influencing the adoption of internet banking amongst Saudi Arabian banking consumers
To explore the factors from select 17 variables used in this study exploratory factor analysis (EFA) technique has been used
Summary
Internet banking refers to the use of a bank’s website through which customers access their banking accounts, conduct financial transactions, and obtain general information on bank products and services. It is a form of “virtual channel” that allows customers to interact with a bank conveniently by providing them with an opportunity to acquire banking services anytime and anywhere (Casalo et al, 2007). Internet banking as a service delivery channel has acquired popularity due to the low cost per transaction and a wide variety of access options for the customer base (Shah & Siddiqui, 2006). The banking industry adopted e-banking as a tool of e-commerce with improved services and operations of banks (Chong et al, 2010), saving costs (Pikkarainen et al, 2004) and facilitating the business activities of bank customers through provision of “anytime and anywhere service” (George & Kumar, 2013)
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