1. Introduction
With the popularization of the mobile Internet, mobile payment services have become widespread. In particular, in China, mobile payment has become one of the most common payment methods due to rapid economic growth, diffusion of the mobile Internet and lack of a credit card payment system. According to data from the Financial Service Report of the People's Bank of China, mobile payments in China reached 202.9 trillion yuan ($30.05 trillion all-year exchange rate average 1: 6.75) of 2017 with an increase of 28.8 percent compared to the whole of 2016 (People's Bank of China).
There are two kinds of mobile payment services in China: QR code payments and (near-field communication (NFC). Three major telecommunication companies and Internet companies including Alibaba and Tencent have been carrying out business in QR code payments and NFC areas, respectively. The growth of mobile payment services has led to the emergence of online financial services, including Alibaba's Alipay, Tenpay's Tenpay, Huawei Pay, Apple Pay, and Samsung Pay. In particular, since telecommunication companies, banks, smartphone makers, BAT and other Internet companies have entered the mobile payment business, the mobile payment market has been growing rapidly. Despite of the rapid growth of mobile payment business and the importance of the academic understanding of the mobile payment, there is not enough research about the adoption of mobile payment services(Dahlberg, Guo, & Ondrus, 2015). This study aims to investigate what determines consumers’ adoption of mobile payment services.
China is a huge market of 1.3 billion consumers. As the first step toward understanding the Chinese mobile payment business, this study focuses on women consumers, who account for 49% of the market and whose influence on the consumer market has been expanding quickly. The current study will focus on what influences on Chinese women consumers’ use of mobile payment services. In particular, based on the technology acceptance model (TAM), antecedents of the intention to use mobile payment systems will be examined. Considering the fact that TAM has some limitations to comprehensively explain the adoption of new technology, current study will highlight the role of security and compatibility and psychological benefits. Lack of security and compatibility was considered as the representative barriers to the adoption of new technology(Dahlberg, Guo, & Ondrus, 2015). In this study security and compatibility will be examined as antecedents of the perceived usefulness and antecedents of the perceived ease of use. Moreover, this research will investigate how psychological benefits mediates the relationship between the intention to use mobile payment systems and the usefulness and the ease of use. This understanding of women consumers in China is a prerequisite to a successful retailing strategy for the Chinese market.
2. Theoretical Background and Hypotheses
2.1. Mobile Payment
Mobile payment services are those performed via mobile devices, including mobile phones (Butz & Kruger, 2001; Liébana-Cabanillas, Marinkovic, de Luna, & Kalinic, 2018). A mobile payment service allows users to trade a certain product or service by transferring a certain number of credit points or a fixed deposit amount. These services are gradually expanding from small amount payments to high amount payments. With the help of technology development and the penetration of smartphones, mobile payment systems have evolved into various forms including mobile wallets, contactless NFC, and QR code payments. In China, consumers are able to use payment services anytime and anywhere, which extends the banking business.
2.2. Technology Acceptance Model
TAM was primarily developed to understand and predict the behaviors of computer users in the workplace (Davis, 1989), and has mainly been studied in relation to information technology acceptance within organizations (Chau & Hu, 2001; Taylor & Todd, 1995). TAM applies the relationship between belief-attitude-behavioral intention and the theory of reasoned action (Ajzen & Fishbein, 1975) to the field of information technology. It suggests perceived ease of use and perceived usefulness as a belief that influences the attitude and behavioral intention of using personal information technology (Davis, Bagozzi, & Warshaw, 1989; Taylor & Todd, 1995).
Perceived ease of use refers to “the degree to which a system would be free of effort,” and perceived usefulness refers to "the degree to which a person believes that using a particular system would enhance job performance." Perceived ease of use and perceived usefulness enhanced a consumer's satisfaction, attitude, pleasure, and purchase intention (Chen & Shang, 2018; Johnson, Kiser, Washington, & Torres, 2018; Long, Park, & Lee, 2018; Seo & Lee, 2014; Na & Hong, 2008). Usually, it is found that the usefulness has a greater influence on intention compared to the ease of use (Davis, Bagozzi, & Warshaw, 1989; Koufaris, 2002; Liébana-Cabanillas et al., 2018; Venkatesh & Davis, 2000).
This study investigates the antecedents of the perceived ease of use and usefulness. This investigation would enrich the current TAM literature and could suggest managerial implications on how to motivate potential consumers to use a mobile payment service.
2.3. Security
Usually, security refers to the measures that are taken to protect one’s property. With the widespread use of smartphones, the security of personal information stored on smartphones has become very important for users. In particular, smartphones contain important and sensitive personal information, and therefore access to this information must be controlled in order to protect the user’s privacy.
As with other literature related to consumer’s technology acceptance, this study has an interest in security, not as a measure to protect one’s property, but as the consumer’s perceived safety. This refers to the degree to which consumers feel safe about personal privacy infringement or data security when using mobile payment services (Buellingen & Woerter, 2004). In particular, in the mobile payment context, perceived security refers to the degree of feeling secure about personal information leakage when using a mobile payment service. With the popularization of the mobile Internet, it has become possible to access information anytime and anywhere, and so the possibility of information leakage has become a serious problem (Gunasekaran & Nagi, 2003).
Previous research has shown the importance of the consumer’s perception of security. The risk of personal information leakage, privacy violation, and hacking has a negative influence on the consumer’s attitude toward mobile payment services (Moon & Jung, 2004). Perceived security determines a consumer’s intention to use a mobile payment service(Johnson et al., 2018; Liébana-Cabanillas et al., 2018).
Therefore, this study hypothesized that the higher the consumer's perceived security of a mobile payment service is, the higher perceived ease of use and perceived usefulness of mobile payments will be.
[H1] The security of mobile payments has a positive effect on perceived usefulness.
[H2] The security of mobile payments has a positive effect on perceived ease of use.
2.4. Compatibility
Compatibility is the degree to which an innovation is perceived to be consistent with potential users’ existing values, prior experiences and needs (Mallat, Rossi, Tuunainen, & Oorni, 2006). Compatibility is considered one of the most important predictors in Innovation Diffusion Theory by (Rogers, 1983), which explains consumers’ adoption of innovations. According to the theory, five innovation characteristics: compatibility, complexity, observability, relative advantage and trialability, determine the consumer’s adoption of an innovation (Mallat et al., 2006). However, some research shows that only compatibility, complexity, and relative advantages are consistent antecedents of the diffusion of innovation (Agarwal & Prasa, 1998; Plouffe, Hulland, & Vandenbosch, 2001).
Some researchers have incorporated compatibility and TAM so that they can better predict a consumer’s adoption of innovative technologies such as spreadsheet software, online services and smart cards (Brancheau & Wetherbe, 1990; Plouffe, Hulland, & Vandenbosch, 2001). In particular, research on mobile banking adoption in the UK shows that the compatibility of mobile banking with consumer needs and lifestyles had a positive effect on attitudes towards the adoption of mobile banking (Lee & Cheng, 2003). Also, compatibility positively influences on the perceived usefulness and the ease of use (Kim, Muna, & Kang, 2007; Wu & Wang, 2005)
Therefore, this research hypothesized that the higher the consumer's perception of compatibility is, the higher perceived ease of use and perceived usefulness of mobile payments will be.
[H3[ Compatibility has a positive effect on perceived usefulness.
[H4[ Compatibility has a positive effect on perceived ease of use.
2.5. Psychological Benefit
Zeithaml (1988) proposed that the customer’s perceived value is the benefits received from a product or service relative to the cost paid for the product. A benefit is the extent to which consumers’ needs or wants are fulfilled by consuming or using a product or service (Gutman, 1982; Kazemi & Javanmard, 2017; Lee & Huh, 2017; Peter & Olson, 1987). Peter and Olson (1987) divided benefits into functional benefits, psychological benefits, and social benefits.
Functional benefits are direct benefits from consuming or using a product or service and are usually related to the concrete attributes or functions of a product or service. Psychological benefits are emotional benefits from consuming or using a product or service and are usually related to the abstract attributes of a product or service(Claeys, Swinnen, & Abeele, 1995; Gerpott, Rams, & Schindler, 2001). In this study, psychological benefit is defined as the customers’ emotional benefits when they use mobile payment services.
Functional benefits have been considered as more important than psychological benefits and researched as a major antecedent of attitude and purchase intention or intention to use (Reibstein & Traver, 1982; Bawa & Shoemaker, 1987). However, recent studies have investigated the role of psychological benefits. Some studies have shown that monetary facilitation provides psychological benefits such as pleasure and entertainment (Liao & Ze, 2006).
Recently, with the development of a mobile payment infrastructure and the increase in users, it takes less time for consumers to complete the purchase process with mobile payments. Compared to traditional offline payment, which requires paper currency or a credit card, mobile payment can be paid easily via smartphone. Therefore, it is considered useful and easy to use a payment service, and moreover, the efficiency and accuracy of mobile payment allow consumers to perceive themselves as smarter customers. This perception leads to such psychological benefits such as pleasure, curiosity, interest and entertainment (Chandon, Wansink, & Laurent, 2000).
Based on the review of previous literature, it is hypothesized that the perceived usefulness of mobile payments and perceived ease of use will lead to psychological benefits.
[H5] Perceived usefulness has a positive effect on psychological benefits.
[H6] Perceived ease of use has a positive effect on psychological benefits.
Previous research has shown that the psychological benefits of coupons increases the intention to use coupons (Price, Feick, & Guskey-Federouch, 1988). Consumers who experience some psychological benefits while using payment services, including satisfaction and pride, intend to use these services (Lichtenstein, Netemeyer, & Burton, 1990). In particular, when consumers use mobile payment services through new media, they are more likely to feel interested, pleasured, and proud of their adoption of this technology. For example, it has been shown that psychological benefits including fun and entertainment have a positive effect on attitude and intention to use (Ashworth, Darke, & Schaller, 2005; Chandon et al., 2000). Therefore, it is expected that these psychological benefits will increase the consumer’s intention to use mobile payment services.
[H7] Psychological benefits have a positive effect on the intention to use mobile payment services
Based on previous research and these hypotheses, this study suggests a research model, as shown in [Figure 1]. Considering the importance of security and compatibility of mobile payment services, this research suggests these as antecedents of usefulness and ease of use. Moreover, the current study examines the mediating role of psychological benefits between the perceived usefulness and the ease of use and the intention to use mobile payment services.
[Figure 1] Research model
3. Methodology
3.1. Samples
Data for this research were collected via an online site. In order to verify the hypothesis of this research, 190 young Chinese women were recruited and responded to a survey questionnaire. The responses of 10 participants who did not answer some questions were removed. Thus, responses from 180 participants were used for the subsequent analysis. Demographic information on the respondents are described in [Table 1].
[Table 1] Demographics Information of the Participants
3.2. Measurements
To ensure the validity and reliability of measurements, the measurement items were adopted from previous research and then modified for this study. Participants answered to items on a five-point scale (1=strongly disagree; 5=strongly agree). [Table 2] shows the operational definitions and measurement items of each construct.
[Table 2] Operational Definitions and Measurements
4. Data analysis and results
4.1. Reliability and Validity
In order to verify reliability and validity, SPSS 24.0 and AMOS 21.0 were used. Confirmatory factor analysis was conducted using the Maximum Likelihood Method. As shown in [Table 3], the standardized loadings(λ) and t-value of all constructs were significant, thus verifying convergent validity (Anderson & Gerbing, 1988; Bollen, 1989). The composite reliability (CR) was greater than the general standard of 0.7, showing that all items had adequate reliability and discriminate validity. Cronbach's α value of each construct was greater than .70, ensuring internal consistency. As presented in [Table 4], the average variance extracted value (AVE) was over 0.5 and every square root of AVE was bigger than the correlation coefficients of each construct, thus verifying discriminant validity.
[Table 3] Confirmatory Factor Analysis
χ2=225.831, p=0.022, χ2/df=225.831, GFI=0.977, GFI=0.901, TLI=0.971, IFI=0.977 RMR=0.034, RMSEA=0.03
[Table 4] Correlation Coefficients Between Constructs
Note: 1. Diagonal line is square root of AVE and under the diagonal line is correlation coefficients. 2. p* <.05, p** <.01, p*** <.001
4.2. Hypothesis Test
AMOS 21.0 was used to analyze the model fit and hypothesis. The indices of model fit show that the current research model had a good fit (GFI= .863, CFI= .933, TLI= .923, IFI= .934, RMSEA= .050, RMR= .047). In addition, as shown in [Table 5], all hypotheses were supported. Specifically, the security has a positive effect on perceived usefulness (H1: β=.360, p< .001) and on perceived ease of use (H2: β=.373, p< .001). Compatibility has a positive effect on perceived usefulness (H1: β=.377, p<.001) and on perceived ease of use (H2: β=.496, p<.001). Perceived usefulness has a positive effect on psychological benefits (H5: β=.560, p<.001) and perceived ease of uses has a positive effect on psychological benefits (H6: β=.175, p<.05). In addition, the psychological benefit positively influences on the intention to use mobile payment services (H7: β=.241, p<.05).
[Table 5] Results of Hypothesis Path
5. Conclusion
The purpose of this study was to investigate ways to influence Chinese women consumers regarding the use of mobile payment services. For this purpose, the authors examined antecedents of the intention to use mobile payment services based on TAM (Davis, 1989; Venkatesh & Davis, 2000). In addition, security and compatibility were examined as antecedents of perceived usefulness and perceived ease of use. Moreover, psychological benefits were suggested and examined as an important construct to mediate between the usefulness and the ease of use and intention to use.
According to the results of this study, security and compatibility positively influences on the usefulness and the ease of use, which have an influence on the psychological benefits of mobile payment services, which in turn have a positive influence on the intention to use mobile payment services.
The theoretical and practical implications of this study are as follows. Most of all, this research empirically explained how Chinese women consumers adopt mobile payment services based on TAM. Although mobile payments became one of the most common payment methods in recent years, there is not enough research about the adoption of mobile payment services(Dahlberg et al., 2015). This study contributes to the academic understanding of consumers’ adoption of mobile payment services.
Moreover, instead of settling for TAM, the current study introduced security and compatibility as antecedents of the usefulness and the ease of use. This introduction not only enhances the accuracy of the adoption model of mobile payment services, but also enriches TAM-related literature.
In addition, this study revealed the mechanism of the effect of the usefulness and the ease of use on the intention to use by demonstrating the mediating role of psychological benefits. In particular, even though consumers pursue psychological benefits as well as economic value, psychological benefits have not been researched enough compared to economic value. This study contributes to an academic understanding of the less-highlighted psychological benefits. In future research, psychological benefits are expected to be studied as an important variable to explain the adoption of new technology, including mobile payment services.
From a managerial standpoint, this study provides potentially valuable insights for marketers of retailing companies who are motivated to attract more consumers. In order to induce potential consumers to use mobile payment services, marketers need to enhance the perceived security and compatibility of mobile payment services. This will lead to the intention to use mobile payment services by perceived usefulness, perceived ease of use, and psychological benefits. In particular, marketers should provide psychological benefits from using mobile payment services. For example, marketers need to communicate target consumers that when consumers use mobile payment services they can get psychological benefits such as pleasure, curiosity, interest and entertainment.
The current research has some limitations. First, this study focused on young Chinese women. Even though these participants are one of the major consumer segments of mobile payment services in China, further study using other samples could enhance the generalization of our findings. Also, the current study was conducted in China (i.e., an interdependent culture) where people are more conscious of others and are likely to follow the behavior of group members compared to people in Western countries, including the United States and the EU (i.e., independent culture). Given these cultural differences, future research is required to examine the moderating role of cultural differences in the adoption of mobile payment services.