Thesis Submitted for the Degree Of
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AN INVESTIGATION OF THE INTERNET BANKING (IB) ADOPTION, USE, AND SUCCESS IN SAUDI ARABIA (SA) A Thesis Submitted for the degree of DOCTOR OF PHILOSOPHY IN THE FACULTY OF MANAGEMENT BY Mohammed Eid Al-Qahtani Business School Department Hull University Hull, UK May, 2014 © (Mohammed E. Al-Qahtani), 2014 All rights reserved Dedication "O my Lord! Let my entry be by the Gate of Truth and Honour, and likewise my exit by the Gate of Truth and Honour; and grant me from Thee an authority to aid (me)." (Holy Quraan 017.080) (May God Almighty rest his soul in peace). To My Parents (who passed away without seeing this achievement), Wife, Son, Daughters and all my Brothers and Sisters II Acknowledgment Upon to the completion of this research, I am grateful to a number of people, as without their help; hardly would I finish the work. Due to that, I would like to thank the following people, as they have a great contribution to this research. First, I am grateful to my most supervisor Dr Dimitrios Tsagdis senior lecturer and Director of the research Centre for Regional and International Business at Hull University Business School, for his tolerance and high level of freedom that he granted me. He has spent his precious time to discuss and to make valuable comments on the project, from an earlier model of the study, through the questionnaire and the writing of this thesis. He gave his valuable advice and guideline generously at all times. I also wish to thank my second supervisor Professor John Reast as well as the examiners of my thesis Professor G. de Zeeuw and Professor Chanaka Jayawardhena for their valuable comments. I am also grateful to my wife, for her great support during the period of my PhD. She has spent the time, day and nights, standing beside me encouraging and motivating me to overcome the obstacles and increase my performance. I am also grateful to all my brothers and sisters who provided me with their emotional and moral support. A special thanks to Mr. Hussam Haddad the general director of Al-Wahda Express Saudi Company for their participation in the field work of this research. Mr. Haddad has provided his great and unreserved support in collecting the required data for this research. Many thanks also go to Al-Wahda Express employees in the central and eastern province who provided their help and support as and when it was needed. I am also grateful to Dr. Faisal Mohammed Al-Muhanna Abalkhail the Cultural Attache of the Saudi Embassy and the academic advisors in the Saudi Cultural Bureau in London for their continued support. Many thanks also go to the many friends and associates over the past four years in the banking, private and the government sectors who provided moral support, insightful comments and sharp wit when they were most needed. Finally, I would like to thank all the respondents for giving their valuable time and information in this research. Without their co-operation, the research would not have been possible. Mohammed E. Al Qahtani May, 2014 III Abstract This thesis attempts to empirically investigate the different factors that have relation with the adoption, use and success (Dependent variables) of Internet Banking (IB). It extended the previous marketing literature and TAM model by investigating different factors that might have relationship with the adoption and use of the IB. In addition to that, and since the success of IB has not been found in the reviewed literature, this study introduces the success variable following the DeLone and McLean (2003) IS success model. This thesis responds to several researchers’ calls by conducting an investigation in Saudi Arabia (SA), where it has special socio-economic motives and social values such as Islamic Banking (IsB). The data of this study were collected through a survey (postal questionnaires), sample (n=1000), which has been conducted randomly using SA’s Residential Telephone Directory. A total of 228 usable questionnaires were returned (22.8% response rate). The data were analysed using descriptive statistics method, and a factor analysis was also used to classify the variables into a set of dimensions. Moreover, multiple regression analysis was performed to test the research hypotheses. As a result, the researches’ models of adoption, use and success have shown high, good and fair prediction powers (R²=62%, 39.4% and 30%, respectively), which are comaparable to other studies in the area. The research findings suggest that awareness, resistance to change, satisfaction, perceived ease of use, self-efficiency, high cost, availability of IsB services online, and income (independent variables) were affecting the IB customers’ adoption, use and success in different degrees. The awareness and self-efficiency of the IB were found to significantly affect the adoption of IB, whereas self-efficiency and satisfaction “convenience” significantly affect the use of IB. However, frequency and wide range of the used IB services, satisfaction “time saving and customers’ needs fulfilment”, income and the availability of IsB services were found to also affect the success of the IB services. Surprisingly, the research findings indicate that security does not contribute significantly to the adoption, use, and success of IB services and that is due to some reasons which is recommended for future studies. It is also essential to highlight that IB customers’ satisfaction was found to be a very significant factor in motivating the new adopters to use the services frequently, which will lead to a successful competitive performance. This thesis concludes with implications for researchers, practitioners, and policy makers in addition to research limitations and recommendations for future studies. IV Table of Content Dedication ......................................................................................................................... II Acknowledgment ............................................................................................................. III Abstract ............................................................................................................................ IV Table of Content ............................................................................................................... V List of Tables .................................................................................................................... X List of Figures ................................................................................................................ XII List of Acronyms .......................................................................................................... XIV Chapter One: Introduction .............................................................................................. 1 1.1 Research Background ................................................................................................... 1 1.2 Background of SA......................................................................................................... 3 1.2.2 SA Demographics Background...............................................................................5 1.3 E-Banking ..................................................................................................................... 9 1.4 Internet Banking (IB) .................................................................................................. 11 1.5 IB in SA ...................................................................................................................... 14 1.6 The Importance of the Study....................................................................................... 17 1.7 Research Questions ..................................................................................................... 22 1.8 Research Aims and Objectives ................................................................................... 23 1.9 Research Methodology ............................................................................................... 23 1.10 Thesis Structure ........................................................................................................ 25 Chapter Two: Literature Review and Hypotheses Development ............................... 28 2.1 Introduction ................................................................................................................. 28 2.2 Models, theories and customer attitudes towards IT .................................................. 29 2.2.1 Consumer Behaviour Matrix .................................................................................30 2.2.2 Hoxmeier Model ...................................................................................................31 2.2.3 Theory of Reasoned Action (TRA).......................................................................32 2.2.4 Technology Acceptance Model (TAM) ................................................................34 2.2.5 DeLone and McLean’s (D & M) Model of IS Success ........................................36 2.3 Customer Attitudes towards IT and IB ....................................................................... 37 2.3.1 Attitudes towards IT and IB in SA .......................................................................37 2.3.2. Attitudes towards IT and IB in Developing Economies ......................................42 V 2.3.3 Attitudes towards IT and IB in Developed Economies ........................................48 2.4 The Research's Conceptual Model and Hypotheses Development ............................