Factors affecting the adoption of mobile banking among rural South Africans

Abstract

Financial services are not easily accessible to people in remote rural areas. In a contemporary business environment, financial institutions close bank branches in remote areas due to the cost associated with sustaining the branches. As a result people in these rural areas become excluded from participating in the financial sector. In South Africa people face barriers to accessing financial services due to geographical locations and the cost associated with it. Mobile banking enables people to access banking services at any place and at any time. The benefits of mobile banking services are heightened in rural areas where no bank branches exist, and they offer a potentially cheap means of communicating and transacting in business. Despite the availability of mobile banking, those that need financial services the most do not adopt it. Although people in rural areas in South Africa have access to mobile phones, this does not necessarily translate into the adoption of mobile banking. This study examines the factors that affect the adoption of mobile banking among rural South Africans. A survey questionnaire was developed and used to collect data from 211 respondents located in four rural areas in the Free State province. The results of the study contribute to knowledge by illustrating that although individuals own and use cellphones, it does not necessarily translate into them adopting mobile banking. The study found that the context of individuals, as well as perceived factors such as awareness, usefulness, cost, complexity, trust, and perceived advantages affect the adoption of mobile banking in rural South Africa. Having an understanding of the factors that affect the adoption of mobile banking among rural South Africans brings to the fore a neglected area of study and addresses a gap in literature on the mobile banking practices of this segment of the market. The results of the study provide practical recommendations for management, future research and industry.