Barriers to the adoption of mobile payment services in South Africa
the low adoption of formal banking products presents a unique opportunity for companies to offer simple and accessible banking products that make use of new mobile phone technologies. There remains a large part of the adult population that is potentially well suited to mobile transactional banking that is vastly different from the historical methods of banking. The purpose of this research was to understand the barriers leading to the slow adoption rate of new mobile technology services within South Africa. This study was focussed within the mobile financial transaction sector where there are many new parties entering the market attempting to take advantage of the high cell phone penetration levels and new technologies within the cellular phone industry. This study was specific to new financial services not linked to current banking structures that are either targeted at the unbanked or at current banking users as an alternative to historical banking models. An online questionnaire was used for data collection from respondents who had either previously used, currently use or had never used mobile banking services in order to understand their habits. A total of two hundred and thirty-seven questionnaires were completed and twenty-six were excluded due to being incomplete. The total sample size of the useable questionnaires was two hundred and eleven. There were one hundred and six respondents in target group one (current users), fifty-two respondents in target group two (previous users) and fiftythree respondents in target group three (never used). The demographics of those users who are likely to use mobile banking services as suggested by the survey are more male than female, are between the ages of twenty-one and thirty-nine and have at least finished school. Factor analysis was run on the data collected from the questionnaires and it was concluded that the factors that were initially proposed were indeed factors influencing the adoption of mobile banking services in South Africa. The factors were Value and Usefulness, Security, Technical Knowledge and Ease of Use. In iii addition to these factors, it was shown that Cost was an additional barrier that affected adoption. The analysis showed that the service needs to deliver an unmet need of the user. If the user finds value in the product and it is better to use than alternative products, then it will be adopted. Costs relating to banking as a whole can be a large barrier to adoption. Companies need to ensure that both their setup and ongoing costs are kept minimal, while making it clear in their marketing that this is the case. The product needs to be easy to use while not requiring a lot of effort. Support needs to be given to users throughout the product life cycle while ensuring that the registration processes is efficient in order to get their target market using in the first place. The combination of ease of registration and negligible ongoing complexities will ensure that users will continue to make use of their services. To ensure ongoing usage of mobile banking services, organisations need to instil a sense of confidence on their users. Being able to use all features of the product allows users to gain this assurance and will, therefore, continue to use the product. Finally, it is crucial that users believe that their financial information is in safe hands. Trust has to be gained firstly in the company itself, then in the service. Taking head of the demographic profiling together with the factors influencing mobile banking service adoption will allow organisations wishing to enter the market or increase their market share within South Africa to create a strategy to be successful in the future.