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Factors Influencing Mobile Payment Adoption and Its Role in Promoting Financial Inclusion: An Integrated Reflective Model with Theory of Planned Behavior

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Innovation of Businesses, and Digitalization during Covid-19 Pandemic (ICBT 2021)

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Abstract

This paper investigates the factors influencing mobile payment adoption and its contribution to financial inclusion, which seems sparse and lacking in the literature. Over 75% of Palestinian adults are excluded from financial services by banks and other non-bank financial institutions, so mobile payment is expected to bridge this gap. A quantitative approach was employed using 307 questionnaires designed based on the theory of planned behaviour and reflective model for measuring financial inclusion. In data analysis, a structural equation modelling in AMOS was applied to data elicited. It was found that all direct paths within the model were supported, except for the paths between subjective norm and mobile payment intention. The proposed model supports the mediation role of attitude, subjective norm, and perceived behavioural control between beliefs and mobile payment intention. Additionally, with successive increases in mobile payment usage, financial inclusion moved further to increase. Precisely, the growth of mobile payment usage by 1% can improve financial inclusion by 0.60%. Taken together, the structural model can explain 36% of covariance in financial inclusion for mobile payment. The originality of this research lies in empirically investigating the potential role of mobile payment in fostering financial inclusion in Palestine, which would contribute to the efforts that intended to overcome the financial exclusion faced by the majority of Palestinian, which benefits the researchers, public, business community, and policymakers.

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Authors and Affiliations

  1. Palestine Ahliya University, Bethlehem, 1041, Palestine

    Mousa Ajouz & Faeyz Abuamria

  2. Al-Quds Open University, Bethlehem, 489, Palestine

    Jehad Hammad

Authors
  1. Mousa Ajouz
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  2. Faeyz Abuamria
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  3. Jehad Hammad
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Corresponding author

Correspondence to Mousa Ajouz .

Editor information

Editors and Affiliations

  1. Northern Cyprus Campus, Middle East Technical University, via Mersin 10, Turkey

    Bahaaeddin Alareeni

  2. College of Business of Finance, Ahlia University, Manama, Bahrain

    Allam Hamdan

Appendix 1: Assessment of the Measurement Model

Appendix 1: Assessment of the Measurement Model

Constructs and related measurement items

Loadings

Composite

reliability

AVE

Intention to use mobile payment

 

0.926

0.808

IU1

I intend to use mobile payment at some point in the future

0.90

  

IU2

I am willing to use mobile payment

0.93

  

IU3

If available, I would definitely use mobile payment

0.87

  

Attitude toward using mobile payment

 

0.915

0.682

AT1

Using mobile payment would be a good idea

0.79

  

AT2

Using mobile payment would be a wise decision

0.79

  

AT3

Using mobile payment would be beneficial

0.81

  

AT4

I like the idea of using the mobile payment for conducting financial transactions

0.89

  

AT5

Using mobile payment would be a pleasant experience

0.85

  

Subjective norm towards using mobile payment

 

0.875

0.584

SN1

I intend to follow the advice of my friends to use mobile payment

0.79

  

SN2

I feel it is expected of me by others to use mobile payment

0.79

  

SN3

I feel being under the influence of others to use mobile payment

0.65

  

SN4

I feel comfortable following the advice of some knowledgeable people to use mobile payment

0.79

  

SN5

The fact that many people whom I may know already use mobile payment makes me consider using it too

0.79

  

Perceived behavioral control towards using mobile payment

 

0.844

0.578

PC1

I have a great deal of control in terms of resources and opportunities over mobile payment

0.72

  

PC2

It is easy for me to use mobile payment

0.82

  

PC3

I feel a great deal of confidence about my ability to use mobile payment

0.84

  

PC4

I do not feel any difficulty in using mobile payment

0.66

  

Belief about using mobile payment

 

0.833

0.501

BF2

I do not involve myself in fraud by using mobile payment

0.69

  

BF3

I should not have problems if I want to convert electronic money into cash

0.72

  

BF4

I can even use electronic money for some transactions without converting it into cash

0.76

  

BF6

So many other people are using mobile payment cannot be wrong

0.72

  

BF7

My family would approve of me using mobile payment

0.67

  

Financial inclusion

Accessibility of financial services

 

0.923

0.705

AC1

I have an account with a financial institution

0.83

  

AC2

I have access to the credit

0.84

  

AC3

I have access to debit/credit cards

0.89

  

AC4

I have access to online/mobile banking

0.86

  

AC5

I have access to insurance products

0.78

  

Availability of financial services

 

0.876

0.647

AV2

There is an ATM near to me

0.55

  

AV3

I believe the financial sector provides a wide variety of financial products

0.84

  

AV4

I believe the financial sector provides a wide variety of financial services

0.93

  

AV5

I believe the financial sector provides financial products and services that fit for my financial needs

0.84

  

Usage of financial services

 

0.858

0.549

US1

I use financial services regularly

0.78

  

US2

I make payments using debit/credit cards

0.81

  

US3

I make money transfer through a financial institution (Bank)

0.70

  

US4

I pay online through a financial institution (Bank)

0.70

  

US5

I pay bills online through a financial institution (Bank)

0.70

  

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Ajouz, M., Abuamria, F., Hammad, J. (2023). Factors Influencing Mobile Payment Adoption and Its Role in Promoting Financial Inclusion: An Integrated Reflective Model with Theory of Planned Behavior. In: Alareeni, B., Hamdan, A. (eds) Innovation of Businesses, and Digitalization during Covid-19 Pandemic. ICBT 2021. Lecture Notes in Networks and Systems, vol 488. Springer, Cham. https://doi.org/10.1007/978-3-031-08090-6_36

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