Context Of Financial Services Research Articles

Implication of Financial Services Marketing: A Study with reference to Behavioral Economics

Abstract Purpose – It has been argued that the insights provided by behavioral economics have profound Implications for the study and practice of marketing. The purpose of this paper is to provide a detailed analysis of how such insights help enhance understanding of aspects of marketing and consumer behavior in financial services markets. Design/methodology/approach – This paper looks at various facets of behavioral economics Which it is felt provide particularly important and salient insights in the context of financial services. In particular, it studies loss aversion and prospect theory, status quo bias and defaults, framing and anchoring effects, hyperbolic discounting, availability effect and salience and over-confidence. In doing so, it provides a number of examples from the financial services context which provide insightful and informative insights for both commercial practitioners and policymakers. In each case, relevant phenomena are introduced and explained before providing a number of applications and examples from the financial services domain. Findings – The authors find that the insights afforded by behavioral economics are useful in helping to explain various aspects of consumer behavior in financial services markets. It is shown that an understanding of the implications of behavioral economics may help in fashioning a choice architecture that is more likely to bring the desired consumer response, from either a commercial or policymaking perspective. Practical implications – This analysis provides important insights for those responsible for the Marketing of financial services, policymakers in the financial services domain, third sector agencies seeking to foster greater engagement with financial services and other interested parties. Originality/value – The paper adds value by drawing together various aspects of behavioral Economics, providing an analysis of their relevance to financial services marketing and offering Numerous examples and applications. Keywords-: Financial services, Behavioral economics, Consumer behavior in financial services, Marketing Paper type-: Conceptual paper

Analisis Syariah Marketing Mix Arrum BPKB dan Urgensinya dalam Meningkatkan Pendapatan UMKM Nasabah Pegadaian UPS Diponegoro Sumenep

The main objective of this study is to analyse the impact of the Arrum BPKB sharia marketing mix at Pegadaian UPS Diponegoro on the income level of MSME customers.This qualitative case study uses structured interviews to collect primary data from MSME players, complemented by secondary data from institutional records. The focus of the analysis is placed on understanding how the application of Sharia principles in marketing can improve business funding solutions. The application of Sharia Marketing Mix for Arrum BPKB financing has significantly increased customer interest and participation. Interviews with five MSME customers showed a marked increase in their daily and monthly income, confirming the effectiveness of this strategy in the real world. This study highlights the alignment of Shariah-compliant practices with customer needs and market dynamics. The findings underscore the importance of incorporating Shariah principles in marketing strategies in Islamic financial services. In practical terms, this approach not only helps in complying with ethical standards, but also enhances customer trust and financial inclusion for cash-strapped MSMEs. This study introduces new insights into the localised impact of Shariah marketing practices on MSME profitability, particularly in the Indonesian financial services context, and sets a precedent for further regional studies

The Link between Family Financial Socialization in Adulthood and Investment Literacy of P2P Investors

AbstractThis paper examines how family financial socialization in adulthood is linked to the development of investment literacy among individual family members within the context of innovative financial services, specifically peer-to-peer (P2P) lending. Our findings revealed that P2P lending investors engage in a moderate level family financial socialization suggesting that family, as a key financial socialization agent in childhood and adolescence, maintains its role in adulthood. Additionally, such investors possess a high-level investment knowledge, skills, and attitudes. Explicit family financial socialization has a significant and positive effect on the individuals’ investment knowledge, skills, and attitudes, while the effect of implicit financial socialization is significant but negative for knowledge and attitudes. Such findings suggest that family discussion among adult members result in higher, while observations of family members’ investment behavior led to lower investment literacy. Our study found no significant moderating effect of the strength of social ties indicating that dynamics of family relations neither strengthen nor weaken proximal socialization outcomes. The analysis of differences across demographic groups unveiled statistically significant distinctions concerning respondents’ gender, income, and education. These results provide important insights for stakeholders, underscoring the significant role family socialization in adulthood plays in shaping individuals’ investment literacy, particularly of those investing on P2P lending platforms.

A Legal Perspective on the Antecedents of Consumer Protection in Digital Financial Services

This research delves into the factors influencing consumer protection within the context of digital financial services, with a focus on the regulatory landscape, technology integration, consumer awareness, and data privacy. The primary objective is to analyze the impact of these factors on the improvement of consumer rights and safety. A quantitative approach was employed, utilizing data collected through surveys of digital financial service users. Confirmatory factor analysis was used to validate the measurement model, followed by structural equation modelling to test the hypotheses. The results demonstrate the significant and positive impact of the regulatory landscape, technology integration, consumer awareness, and data privacy on consumer protection. This study theoretically contributes by empirically confirming the role of these factors in consumer protection in digital financial services. From a practical standpoint, it underscores the importance of robust regulations, seamless technology integration, and effective consumer awareness initiatives in upholding consumer rights and safety. However, it is important to acknowledge certain limitations within this study. Its context-specific nature may restrict its generalizability to other regions, and the analysis primarily focuses on antecedent factors while neglecting potential influences from other variables. Nevertheless, this study's novelty lies in its comprehensive exploration of the foundational factors and their profound impact on consumer protection in the digital financial services landscape, furnishing valuable insights for informed policymaking and industry practices.

Trust in the financial services context: a meta-analysis

PurposeThis article presents a systematic framework with a meta-analytic approach to finding various antecedents, consequents and moderating effects of trust in financial services.Design/methodology/approachA meta-analysis of 165 articles was performed, which generated 272 observations in a cumulative sample of 86,968 respondents.FindingsThe results of this meta-analysis demonstrated seventeen antecedents of trust constructs and four consequents. Most of these relationships were meaningful and consistent. The authors also found some significant moderators related to culture (individualism, masculinity and long-term orientation) and context (innovation index and device type).Research limitations/implicationsThis meta-analysis reviewed the relationships found throughout the theoretical framework about the trust construct in financial service contexts, identifying new paths for future research. Some limitations, such as the non-use of qualitative studies and the selection of concepts, exist in the secondary data and should be noted.Practical implicationsThe present study can assist financial system managers in decision-making because the findings from the meta-analysis are more consistent than those from traditional primary surveys.Originality/valueThis research tested the impact of antecedents, consequents and moderators of trust in the financial services sector and presented significant results using a meta-analytic review. This meta-analysis contributes to the marketing literature by offering a set of empirical generalizations, including relationship coefficients and fail-safe calculated numbers (FSN).

Not transparent and incomprehensible: A qualitative user study of an AI-empowered financial advisory system

AI-empowered and algorithm-driven automated financial advisory systems, also known as Robo-advisors, have been rapidly implemented by service providers and customers in financial service markets. Yet, few empirical studies investigate customers’ experience interacting with fully functional Robo-advisors in real-life scenarios. Also, it is still unknown how the design of the automated system can affect customers’ perception and adoption of this new technology. To mitigate these gaps, 24 participants with different levels of experience and understanding of financial investment were asked to use a Robo-advisor from a retail bank and perform the tasks. By conducting observations and retrospective post-test interviews, we find that participants do not fully perceive the social aspects supposed to be provided by Robo-advisors. The overarching problems are, among others, a lack of transparency and incomprehensible information. This results in distrust of the results generated by this system, which negatively affects customers’ adoption of the investment advice provided by the Robo-advisor. The potential of interactive data visualization is also detected. This work contributes to the understanding of customers regarding their perception and adoption based on their use of a functional Robo-advisor and proposes design takeaways for transparent and comprehensible automated advisory systems in financial service contexts.

Subscriptions versus one-off purchases: the impact of fee-charging models on consumer privacy concerns

PurposeWith the popularity of paid apps and increasing concerns about privacy hazards, this paper aims to investigate the impact of mobile services’ fee-charging models on consumers’ privacy concerns, and generate insights for app developers’ fee-charging strategies.Design/methodology/approachThree experimental studies including 550 participants were conducted. All studies were between-subjects designs and based on the context of financial mobile services. The implementations of fee-charging models were manipulated by both visualized and test-based stimuli.FindingsThe results reveal that consumers are less concerned about potential privacy violations when using subscription-based (vs. purchase-based) financial mobile services (study 1). This effect is mediated by consumers’ perceptions that app developers that charge subscription fees (vs. one-off prices) are more likely to be consumer-serving motivated (study 2 and 3).Originality/valueThis paper advances the current understanding of consumer response toward paid apps, by proposing and testing a novel attribution-based mechanism to explain why the implementation of a subscription-based versus purchase-based fee-charging model can result in more favorable consumer reactions. Furthermore, this paper identifies the implementation of contrasting fee-charging models as a market-related factor that affects the extent to which consumers are concerned about potential privacy violations, extending extant literature on consumer privacy concern.

There and back again: how target market determination obligations for financial products may incentivise consumer data profiling

ABSTRACT Increasingly precise data profiling of consumers is one of the drivers of profit for the financial industry in the digital age. However, data profiling may also bring about harm to consumers, ranging from data breaches to unfair pricing, digital manipulation, discrimination and exclusion of vulnerable consumers, which is particularly problematic in financial services context due to the consequences it has on consumers’ access to financial products. The focus of this article are target market determination (TMD) obligations for financial products and their interplay with data protection rules. It asks if financial product governance rules, requiring TMD and distribution of products within the target market, may further incentivise data profiling of consumers by financial services providers. I analyse this issue looking at two sets of rules applicable to financial firms in Australia: (1) the new financial products governance rules, which came into force in October 2021, and (2) the data protection rules: Australian Privacy Act 1988 and the GDPR. If these frameworks fail to strike a balance between (surprisingly) competing interests of consumer protection regarding the provision of appropriate financial products and the use of consumers’ data in digital profiling, the new rules may backfire, resulting in unintended consumer harms.

Understanding Mobile Financial Services Adoption through a Systematic Review of the Technology Acceptance Model

Various review studies were performed earlier to apprehend the applicability of the technology acceptance model (TAM) in the mobile financial services (MFS) context by assessing several issues. Despite each of those studies offering a valuable synthesis of TAM, further issues are still uncovered and call for further research. Therefore, this paper contributes to the existing literature by comprehensively reviewing TAM-based MFS studies through the analysis of various concerns, entailing the drivers of novelty technology of MFS adoption, analysis methods, TAM progress over publication years, participated countries, and sample size. From a yield of 217 studies collected, 24 empirical studies published between 2011 and 2021 have met the eligibility criteria and were extensively analyzed. The main results revealed that compatibility and perceived security were TAM’s most common external factors influencing the adoption of mobile financial services, followed by subjective norm and trust. While it was developed in 1989, the results unveiled an increasing number of TAM-based MFS studies, yet, expanding the model’s credibility in elucidating the users’ intentions regarding technology adoption. Most analyzed studies have relied on questionnaires to collect empirical data. It was also found that the USA is leading the research on technology acceptance in MFS. This review will enhance practitioners’ understanding through several contributions and implications by presenting the full potential of technology acceptance in MFS that could yield future attempts.

Construct and Criterion Validity of the Dutch Workaholism Scale (DUWAS) Within the South African Financial Services Context

This research investigated the construct and criterion validity of the English version of the Dutch Work Addiction Scale (DUWAS) within the South African financial services context ( n = 345). A quantitative research approach with a cross-sectional design was utilized to determine the psychometric properties of the Dutch Work Addiction Scale (DUWAS-10). Confirmatory factor analysis was used with a latent variable modeling approach for the construct validity and a structural path model for criterion validity. One of the working compulsively items did not perform well and was omitted to establish a 9-item scale. Additionally, due to problematic discriminant validity between the working compulsively and working excessively factors, the results did not corroborate the expected two-factor structure. However, a revised second-order structure of the DUWAS showed an acceptable fit to the data indicating that an overall workaholism score is appropriate in this context. Furthermore, the results showed that workaholism had positive relationships with work overload, work hours, and burnout but negatively related to work engagement and organizational commitment. All in all, evidence suggested that an adapted 9-item version of the DUWAS performed well.

Artificial intelligence in customer-facing financial services: a systematic literature review and agenda for future research

PurposeThe objective of this study is to provide a systematic review of the literature on artificial intelligence (AI) in customer-facing financial services, providing an overview of explored contexts and research foci, identifying gaps in the literature and setting a comprehensive agenda for future research.Design/methodology/approachCombining database (i.e. Scopus, Web of Science, EBSCO, ScienceDirect) and manual journal search, the authors identify 90 articles published in Australian Business Deans Council (ABDC) journals for investigation, using the TCCM (Theory, Context, Characteristics and Methodology) framework.FindingsThe results indicate a split between data-driven and theory-driven research, with most studies either adopting an experimental research design focused on testing the accuracy and performance of AI algorithms to assist with credit scoring or investigating AI consumer adoption behaviors in a banking context. The authors call for more research building overarching theories or extending existing theoretical perspectives, such as actor networks. More empirical research is required, especially focusing on consumers' financial behaviors as well as the role of regulation, ethics and policy concerned with AI in financial service contexts, such as insurance or pensions.Research limitations/implicationsThe review focuses on AI in customer-facing financial services. Future work may want to investigate back-office and operations contexts.Originality/valueThe authors are the first to systematically synthesize the literature on the use of AI in customer-facing financial services, offering a valuable agenda for future research.

Service journey quality: conceptualization, measurement and customer outcomes

PurposeThe quality of the customer journey has become a critical determinant of successful service delivery in contemporary business. Extant journey research focuses on the customer path to purchase, but pays less attention to the touchpoints related to service delivery and consumption that are key for understanding customer experiences in service-intensive contexts. The purpose of this study is to conceptualize service journey quality (SJQ), develop measures for the construct and study its key outcomes.Design/methodology/approachThe study uses a discovery-oriented research approach to conceptualize SJQ by synthesizing theory and field-based insights from customer focus group discussions. Next, using consumer survey data (N = 278) from the financial services context, the authors develop measures for the SJQ. Finally, based on an additional survey dataset (N = 239), the authors test the nomological validity and predictive relevance of the SJQ.FindingsSJQ comprises of three dimensions: (1) journey seamlessness, (2) journey personalization and (3) journey coherence. This study demonstrates that SJQ is a critical driver of service quality and customer loyalty in contemporary business. This study finds that the loyalty link is partially mediated through service quality, indicating that SJQ explains loyalty above and beyond service quality.Research limitations/implicationsSince service quality only partially mediates the link between service journey quality and customer loyalty, future studies should examine alternative mediators, such as customer experience, for a more comprehensive understanding of the performance effects.Practical implicationsThe study offers concrete tools for service managers who wish to understand and develop the quality of service journeys.Originality/valueThis study advances the service journey concept, demonstrates that the quality of the service journey is a critical driver of customer performance and provides rigorous journey constructs for future service research.

Relationships among employee acting, customer-perceived service quality, emotional well-being and value co-creation

PurposeHinged on the transformative service paradigm, this study investigates the relationships among employee acting, customer-perceived service quality, customer emotional well-being, and their value co-creation. Feelings of gratitude among customers may moderate the effect of perceived service quality on their emotional well-being (i.e., positive and negative affects).Design/methodology/approachA pair study using a structural equation model was conducted to gather data from a financial service organization in a rural area.FindingsThe results show how customers perceive service quality positively impacts their emotional well-being immediately after receiving a financial service, which in turn affects their value co-creation. Hence, feelings of gratitude moderate the effect of perceived service quality on customer positive affect.Originality/valueThis study responds to calls for more studies on how service interactions influence customer well-being in the financial services context. This study is among the few that examine moderation effects of customer feelings of gratitude on their emotional well-being to explain why a positive emotion might sway their short-term well-being.

IMPACT OF FINANCIAL INCLUSION IN LOW‐ AND MIDDLE‐INCOME COUNTRIES: A SYSTEMATIC REVIEW OF REVIEWS

AbstractFinancial inclusion programmes seek to increase access to financial services such as credit, savings, insurance and money transfers. Despite a wealth of systematic review evidence, the impacts of financial inclusion are inconclusive. Hence, the first systematic review of systematic reviews was undertaken to synthesize the impacts of financial inclusion interventions on economic, social, gender and behavioural outcomes. Thirty‐two systematic reviews were identified. The headline finding is that impacts are more likely to be positive than negative, but the effects vary, and appear not to be transformative in scope or scale, as they largely occur in the early stages of the causal chain. The effects of financial services on core economic and social poverty indicators are small and inconsistent. There is no evidence for meaningful behaviour‐change outcomes. The effects on women's empowerment appear generally positive, but they depend upon programme features that are often peripheral to the financial service, and cultural and geographical context. Accessing savings opportunities has small but more consistently positive effects for poor people, and bears fewer downside risks for clients than credit. The inconsistent quality of the primary evidence base that formed the basis of their syntheses raises concerns about the reliability of the overall findings.

Impact of financial inclusion in low- and middle-income countries: A systematic review of reviews.

Financial inclusion programmes seek to increase access to financial services such as credit, savings, insurance and money transfers. Despite a wealth of systematic review evidence, the impacts of financial inclusion are inconclusive. Hence, the first systematic review of systematic reviews was undertaken to synthesize the impacts of financial inclusion interventions on economic, social, gender and behavioural outcomes. Thirty-two systematic reviews were identified. The headline finding is that impacts are more likely to be positive than negative, but the effects vary, and appear not to be transformative in scope or scale, as they largely occur in the early stages of the causal chain. The effects of financial services on core economic and social poverty indicators are small and inconsistent. There is no evidence for meaningful behaviour-change outcomes. The effects on women's empowerment appear generally positive, but they depend upon programme features that are often peripheral to the financial service, and cultural and geographical context. Accessing savings opportunities has small but more consistently positive effects for poor people, and bears fewer downside risks for clients than credit. The inconsistent quality of the primary evidence base that formed the basis of their syntheses raises concerns about the reliability of the overall findings.

Service innovation, service delivery and customer satisfaction and loyalty in the banking sector of Ghana

PurposeThe concept of innovation is gaining ground steadily in the context of an increasingly competitive and highly volatile banking sector. The purpose of this paper is to find out the role of service innovation (SI) in the relationship between service delivery (SERVD), customer satisfaction (CSAT) and loyalty in the banking sector of Ghana.Design/methodology/approachDrawing from banking and marketing literature, a conceptual framework was developed and tested using data from 450 sampled customers of commercial banks in Ghana. The data were analyzed using partial least squares structural equation modeling.FindingsThe findings indicate that SI has direct influence on SERVD and CSAT. Again the findings revealed a positive relationship between SERVD, CSAT and bank customer loyalty.Research limitations/implicationsThis study offers theoretical support for the adoption of innovative techniques in service provision and delivery.Originality/valueThis paper provides an initial study into innovation management in financial services context in an emerging economy.

Mitigating the Negative Effects of Customer Anxiety through Access to Human Contact

It is a well-established result in social psychology that when people feel anxious, they seek advice from others. However, increasingly companies that operate in high-anxiety settings (like financial services, health care, and education) are deploying self-service technologies (SSTs), through which anxious customers transact without human contact. The impact of customer anxiety on service relationships is neither well understood, nor consistently factored into service design. In this paper, two laboratory experiments and one field experiment, conducted in financial service contexts, document the negative effects of anxiety on customer choice satisfaction, firm trust, and long-term engagement, and explore the impact of giving self-service consumers the option to interact with a person. Participants engaged in an online investing simulation who are made to feel anxious due to market downturns are less satisfied with their choices and report lower levels of trust in the firm. Providing participants with the opportunity to interact with an expert, or even another participant, dampens anxiety’s negative effects on choice satisfaction and, by extension, firm trust. Interestingly, we find that very few participants who are offered the option to interact with a person take advantage of the opportunity, which is consistent with the idea that it is the mere availability of human contact that mitigates anxiety’s deleterious effects. Finally, in a field experiment conducted with a credit union’s self-service term loan approval process, the incorporation of access to human contact increased customer loan acceptance by 16%, suggesting that access to human contact can improve long-term service engagement.

Autonomous decision-making for antenatal screening in Pakistan: views held by women, men and health professionals in a low-middleincome country.

Prenatal genetic technologies now are being implemented in LMICs, and while there is much research on the ethical, legal and social implications of such technologies in Western countries, there is a paucity of such research in LMICs, which have diverse cultural, religious, political, financial and health service contexts. This study aimed to explore views about women's autonomous decision-making for antenatal screening held by women, men and healthcare professionals (HCPs) in Pakistan. A Q-methodology study was conducted during June 2016 to January 2018 in Lahore, Pakistan. A total of 137 participants (60 women, 57 men, 20 HCPs) rank-ordered 41 statements. Following by-person factor analysis, four distinct viewpoints were identified. Three of these represent views held by women and men only: autonomous decision-making requires directive advice from doctors; autonomous decision-making requires the husband's involvement, where independent decision-making by the woman is considered culturally inappropriate; and opting for antenatal screening is a foregone decision. One contrasting viewpoint represents predominantly HCPs: autonomous decision-making is the couple's responsibility. These findings highlight that Western approaches to facilitating women's autonomy for antenatal screening are unlikely to be suitable for use in Pakistan. Instead, culturally appropriate practice guidelines are needed in LMICs to enable HCPs to adopt shared decision-making approaches in a way that enables them to facilitate active and joint decision-making by couples, while ensuring women exercise their autonomy.

Assessing the effect of Waiting Time Management Strategies on Waiting Time Satisfaction among Bank Customers in Ghana

This paper empirically assesses the effect of waiting time management strategies on consumer waiting time satisfaction (WTS) in bank institutions in an emerging economy, using Ghana banking industry as the research context. Drawing from relevant banking and financial marketing literature, a conceptual framework was developed and tested using empirical data from a cross-sectional survey of 480 sampled customers of commercial banks in Ghana. Data were analysed using partial least squares structural equation modelling (PLS-SEM). The findings indicate that, with the exception of apology for delays, the key factors that influence consumer WTS are perceived compensation, waiting environment, quality of delay information and customer mind-engagement strategies. The findings offer important theoretical and managerial implications to scholars and practitioners in the banking service context. This paper provides an initial study into waiting time management in financial services context in Sub-Saharan Africa.

Tax Evasion, Money Laundering and Tax Transparency in the EU Overseas Countries and Territories: Ex-Post Impact Assessment

This study aims to present the legal, political and institutional framework governing offshore practices in the Overseas Countries and Territories (OCTs) of the European Union, which fall under the sovereignty of four Member States: Denmark, France, the Netherlands and the United Kingdom. It contains an opening analysis that defines the key concepts, including tax evasion, money laundering and tax transparency; outlines the scope of the study (to differentiate the OCTs from other places often mentioned within the context of offshore financial services); and briefly describes the particular case of Greenland. In addition, a comparative analysis of the legal, political and institutional framework governing EU relations with and within the respective OCTs is complemented by an overview of the EU framework and opportunities for action. This aspect can be of significance, especially in view of the UK’s announced withdrawal from the European Union. The detailed annexed contributions covering the OCTs under French, Dutch and British rule, and which constitute a basis for this analysis, were written by external experts.