Customer Behaviour Intention Towards The Use Of Mobile Money

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Customer Behaviour Intention Towards The Use Of Mobile Money


Abstract


The broad objectives of the study boarders on customer behavior intention towards the use of mobile money using MTN product consumers in Lagos State as case study. The study also discusses whether Customer awareness influences consumer adoption of mobile money, investigate whether transaction cost influences consumer adoption of mobile money, determine whether unmet customer expectancy impacts customer behavior intention towards the use of mobile money as well establish whether security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria. Survey research design was employed for the study and with aid of convenient sampling two hundred and twelve (212) participant from who are MTN product consumers in Lagos State was selected as the respondent of the study. The sources of data collection was both primary and secondary with the application of questionnaires as an instrument to gather the necessary data. The questionnaires were properly completed as well returned by only 200 respondent after being administered.Data was analyzed using simple percentage presented in frequencies and tables. Hypothesis test was conducted using Chi-Square Statistical Package for the Social Sciences (SPSS v.23). Findings of the study concludes that customer awareness, Transaction cost, unmet customer expectancy and Security risk factors influences consumer adoption of mobile money, determine .The study therefore recommends that There is need for providers such as Banks/MFIs and Third-Party, to expand their services to other parts of the country, especially the remotest areas so that they capture as many customers as possible. Their concentration along the line of rail excludes a lot of potential customers. More so, there is need for providers such as MNOs to increase the transaction threshold so that more clients could be captured. At the moment consumers who would like to transact amounts that are more than the threshold are left out.


Table of Content


Chapter One:

Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the Problem
  • 1.3 Objective of the Study
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Scope of the Study
  • 1.8 Limitation of the Study

Chapter Two:

Review of Literature

  • 2.1 Conceptual Framework
  • 2.2 Theoretical Framework
  • 2.3 Empirical Review

Chapter Three:

Research Methodology

  • 3.1 Research Design
  • 3.2 Population of the Study
  • 3.3 Sample Size Determination
  • 3.4 Sample Size Selection Technique and Procedure
  • 3.5 Research Instrument and Administration
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis
  • 3.8 Validity of the Study
  • 3.9 Reliability of the Study
  • 3.10 Ethical Consideration

Chapter Four:

Data Presentation and Analysis

  • 4.1 Data Presentation
  • 4.2 Analysis of Data
  • 4.3 Answering Research Questions
  • 4.4 Test of Hypotheses

Chapter Five:

Summary, Conclusion and Recommendation

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendation
  • REFERENCES
  • APPENDIX

Chapter One


Introduction

1.1 Background of the Study

Mobile technology has become very indispensable as it offers platforms for enhancing social and economic development (Baganzi & Lau, 2017) and also gives access to applications that tackle social challenges confronted by vulnerable individuals and allows innovations (Kikulwe et al., 2014; Tiwari et al., 2006). According to GSMA Intelligence, mobile adoption has increased swiftly in West Africa in recent years. This rapid growth is due to the expansion of cellular networks to underserved populations as well as the rising affordability of mobile devices’ costs and services. For instance, the unique subscribers in West Africa at the end of 2016 stood at 172 million, accounting for 320 million mobile connections. Furthermore, the overall subscriber penetration reached 49%, slightly higher than the 47% penetration rate across the wider Sub-Saharan Africa region (GSMA, 2017). In Ghana, the total number of mobile subscriptions reached 37.1 million at the end of July 2017, representing a penetration rate of 130.35% in that month (NCA, 2017). These numbers are expected to grow because of the expansion of mobile networks and services provided by telecommunication operators across the continent (Narteh et al., 2017).

Mobile money (MM), which is one of such new technology-enabled services, allows users to utilize mobile phones to perform financial transactions (Abor et al., 2018). MM is a product that permits customers to utilize text messages to store value in an account accessible by the handset, convert cash in and out of the store value account, and transfer value among users (Aker & Mbiti, 2010; Narteh et al., 2017). MM is increasingly utilized to transfer money to family and friends, pay for goods and services, and store monetary value safely in Ghana (Osei-Assibey, 2015).
More importantly, MM has become an essential means of payment for the underserved and those who are not banked in Ghana. According to the Bank of Ghana (2017), registered MM accounts across the MM service providers were 23.9 millionin 2017, up from 19.7 million in 2016. Meanwhile, the total volume of MM transactions in 2017 was 981,564,563, from 550,218,427 in 2016. In terms of value, it reached GH¢155.8b (US$34.7b) in 2017, from GH¢78.5b (US$18.4b) in 2016. This surge in MM usage seems to suggest acceptance of the service, which has been lauded by many experts and stakeholders in the banking and formal financial sector. Furthermore, this rise appears to signify the relevance of MM in deepening financial inclusion how be it, consumer’s still grapple with adoption of mobile money(Narteh et al., 2017).

Consumer behavior as the sum total of a consumer’s attitudes, preferences, intentions and decisions regarding the consumer’s behavior in the marketplace when purchasing a product or service. Consumer behavior, according to Ajibola and Njogo (2017), is one of the processes of decision-making for any buyer, both individually and in groups, such as how emotions impact buying behavior. Consumer purchasing behavior varies depending on a variety of factors such as demographics, culture, tradition, climate, and so on.Individuals and groups wasting time making decisions and their readiness to part with their money resources is a major setback for sales and performance. A issue in consumer behavior is the primary decision a buyer makes in a group and how that decision effects others. Researchers are still grappling with how to conduct and explore a study of how buying decisions are made in people and groups, and how this impacts the volume of sales and profitability of the marketer/producer.

Despite these encouraging figures in MM account registration, the reality appears quite different as the number of active accounts seems to suggest apparent consumer hesitancy toward MM adoption. That is, there is a considerable difference between the number of registered MM accounts and the number of active MM accounts. For example, while the number of registered MM accounts in Ghana stood at about 23.9 million in 2017, there were only about 11.1 million active MM account users during the same period (Bank of Ghana, 2017) as this is applicable to Nigeria. Thus, the actual figures suggest a high level of inactivity among registered users, thereby raising the question of why consumers are inactive in using MM services. This observation appears to confirm the assertion that “mobile money is still far from being widespread” (Kiconco et al., 2018). Therefore, there is a need to have a clear understanding of the crucial factors that influence users’ intention to adopt and use MM.


1.2 Statement of the Problem

The advent of prepaid cards and the dropped rates of mobile handsets in emerging and less developed economies have been the greatest driver to Mobile Money Transfer (MMT) services in Africa (Tan & Lau2016). The benefits derived from using the mobile money transfer services like convenience, flexibility, simplicity, low cost and its potential of improving financial services has generated of a lot of interest among various players in the financial sector of the economy (Baptista & Oliveira, 2015). However in Nigeria , the use and adoption has been observed to be low most especially amongst the rural partsof the country. This is observed where out of the entire 19.5 million mobile money subscriber equivalent to 57%, 38% are urban households that use MMTs with only 19% rural household that use MMTs, causing a disparity in the adoption and use of the technology [8]. Thus, Customer expectancy, Social factors, Transaction cost and Behavioral Intention may be attributed to low adoption and use of Mobile Money Transfer services in Nigeria.

According to research carried out by Eneizan, Mohammed, Alnoor, Alabboodi & Enaizan (2019), only 10% of Nigerian bank customers are using Mobile Money Services; out of the 10%, 90% use it with their bank account while 10% use it without a bank account. Students’ population was not represented among the users which call for a question regarding why consumers are not adopting and using mobile money services. This could be due to lack of technology readiness given their demographics and exposure, their awareness and adoption of mobile phones and lack of trust on technology. Furthermore, Eneizan et’al (2019)observed that the low adoption could be attributed to the risks, trust, system breakdown, availability is still in the urban and semi-urban areas limiting the access to the rural population, limited access to network agents, users not being able to withdraw money from an agent when they wanted etc. Unfortunately, no or limited study has been done on this area, hence the need to fill the lacuna; considering the low adoption rate of mobile money, it is necessary to understand student’s perception towards the adoption of mobile money services this will enable financial institutions to tap the abundant student market.


1.3 Objective of the Study

The broad objective of this study focused on customer behavior intention towards the use of mobile money. Other specific objectives includes:

  1. To ascertain whether Customer awareness influences consumer adoption of mobile money.
  2. To investigate whether transaction cost influences consumer adoption of mobile money.
  3. To determine whether unmet customer expectancy impacts customer behavior intention towards the use of mobile money.
  4. To establish whether security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria

1.4 Research Questions

  1. Does Customer r awareness influences consumer adoption of mobile money?
  2. Does transaction cost influences consumer adoption of mobile money?
  3. Does unmet customer expectancy impacts customer behavior intention towards the use of mobile money.
  4. Does security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria?

1.5 Research Hypothesis

  • Ho: Customer behavior intention does not have any influence on the use of mobile money.
  • H1: Customer behavior intention significantly influences on the use of mobile money.

1.6 Significance of the Study

The findings from this research study contribute to the adoption and use literature in the area of Mobile Money and in the developing nations. More specifically, to close the gap that exists for Nigeria by serving as a starting point for further research. The findings from this research study can be used by Telecommunication Companies to improve Mobile Money transfer services and to identify those factors that can either contribute to the failure or success of the mobile money transfer services in the rural areas of the country and this could further be used for decision making. To academia, firstly, the research aligns customer expectancy, social factors and transaction costs as significant predictors of MMTS in the rural areas of Uganda. Secondly, the study serves as a source of academic reference for further studies.The findings of this study will help financial institutions to understand the perceptions of students towards the adoption of mobile money services. The study will assist investors or providers in establishing mobile money systems that students want to use, or help them to discover why potential users avoid using the existing system. The study will also help the government to know the extent to which mobile money services are adopted and provide necessary policies and legislation in relation to mobile money services. Again the study will be useful to scholars as it would form a source of reference materials on the further discussion on the subject matter.


1.7 Scope of the Study

The scope of the study boarders on customer behavior intention towards the use of mobile money. The study also discusses whether Customer awareness influences consumer adoption of mobile money, investigate whether transaction cost influences consumer adoption of mobile money, determine whether unmet customer expectancy impacts customer behavior intention towards the use of mobile money as well establish whether security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria. The study is however limited to consumers of MTN products in Lagos State


1.8 Limitation of the Study

Like in every human endeavour, the researchers encountered slight constraints while carrying out the study. The significant constraint was the scanty literature on the subject owing that customer behavior intention towards the use of mobile money discourse is vast thus the researcher incurred more financial expenses and much time was required in sourcing for the relevant materials, literature, or information and in the process of data collection, which is why the researcher resorted to a limited choice of sample size covering only consumers of MTN products in Lagos State. Thus findings of this study cannot be used for generalization for other states within Nigeria. Additionally, the researcher will simultaneously engage in this study with other academic work will impede maximum devotion to the research. Howbeit, despite the constraint encountered during the research, all factors were downplayed in other to give the best and make the research successful.


1.9 Organization of the Study

This research work is organized in five chapters, for easy understanding, as follows.

  • Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study.
  • Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature.
  • Chapter three deals on the research design and methodology adopted in the study.
  • Chapter four concentrate on the data collection and analysis and presentation of finding.
  • Chapter five gives summary, conclusion, and recommendations made of the study.

Chapter Five


Summary, Conclusion and Recommendation

5.1 Summary

The broad objectives of the study boarders on customer behavior intention towards the use of mobile money using MTN product consumers in Lagos State as case study. The study also discusses whether Customer awareness influences consumer adoption of mobile money, investigate whether transaction cost influences consumer adoption of mobile money, determine whether unmet customer expectancy impacts customer behavior intention towards the use of mobile money as well establish whether security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria.

Survey research design was employed for the study and with aid of convenient sampling two hundred and twelve (212) participant from who are MTN product consumers in Lagos State was selected as the respondent of the study.

The sources of data collection was both primary and secondary with the application of questionnaires as an instrument to gather the necessary data. The questionnaires were properly completed as well returned by only 200 respondent after being administered. Data was analyzed using simple percentage presented in frequencies and tables. Hypothesis test was conducted using Chi-Square Statistical Package for the Social Sciences (SPSS v.23).


5.2 Conclusion

Money, referred to as branchless banking, has becomes a tool that allows customers to make financial transactions anytime and in any location using cell phone technology. Complemented by an agent network, this mobile based payment channel has enabled and broadened access to financial and payment services to remotely located and previously unbanked segments of the population in most of the world’s developing and emerging markets. Unlike traditional delivery channels, such as bank branches and ATMs, an agent in the mobile money service channel provides everyday banking and payment-related services to consumers on behalf of the banking institute or mobile network operator (MNO). Agents are designated and contracted by financial services companies or non-banking actors such as telecom and fintech firms. Mobile money offers numerous benefits, including convenience, usability, usefulness, and low cost.

In the context of this study, however, the sustained usage of these services in Nigeria has not reached a sufficiently large scale following customer behavior intention. Thus despite these encouraging figures in MM account registration, the reality appears quite different as the number of active accounts seems to suggest apparent consumer hesitancy toward MM adoption. That is, there is a considerable difference between the number of registered MM accounts and the number of active MM accounts. While this is true, few determinant of customer behavior intention has been reveled in this study as a significant influence for users adoption of mobile money.

From the analysis of the study the following conclusions were derived:

  1. Customer awareness influences consumer adoption of mobile money,
  2. Transaction cost influences consumer adoption of mobile money, determine whether unmet customer expectancy
  3. Customer behavior intention towards the use of mobile money
  4. Security risk factors attributed to low adoption and use of Mobile Money Transfer services in Nigeria.

5.3 Recommendations

Based on the conclusions of the study, the following recommendations are made in order to grow the mobile money industry in Nigeria:

  1. There is need for mobile providers such as MNOs and Third-Party to build permanent structures. This will enhance security at their operation points thereby promoting trust among consumers.
  2. There is need for providers such as Banks/MFIs and Third-Party, to expand their services to other parts of the country, especially the remotest areas so that they capture as many customers as possible. Their concentration along the line of rail excludes a lot of potential customers.
  3. There is need for providers such as MNOs to increase the transaction threshold so that more clients could be captured. At the moment consumers who would like to transact amounts that are more than the threshold are left out.
  4. Instead of relying on consumers to advertise their brand, a provider such as Banks/MFIs needs to put in place robust marketing strategies to grow their customer base. Apart from being a bank, some potential consumers are not aware of that Bank/MFIs offers mobile money services.
  5. Banking and non-banking institutions, in addition to providing a credible agent network, should also educate and train agents to provide better service quality to mobile money users. Improved services will empower customers as well as increase Africa’s financial literacy, which currently falls under the sole jurisdiction of different governments and regulators. A carefully selected, contracted, trained, socially savvy, and credible agent network will thus help banking companies, MNOs, and fintech companies drive new business, increase the customer base (previously thought of as non-bankable), build brand awareness, and improve the customer experience.

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