CHAPTER 1

INTRODUCTION

This chapter provides the background of study, problem statement, research questions,
research objectives, hypotheses and significance of study.

1.1 Background of Study

The advancement in technology has changed the ways businesses are being done. Prior
to the technology advancement, many businesses have started to shift from the
conventional ways of doing business toward the use of highly integrated technology.

The banking industry has been perceived as the industry in which it has experienced the
most significant change in their business processes. Over the decades, the services
provided by particular financial institutions have evolved considerably.

Face to face meetings and phone calls, which were the major services in which banking
institutions provided have been deemed to be obsolete and could no longer satisfy the
customers. Henceforth, banking institutions have actively engaged in developing and
integrating the highly sophisticated technology systems in which it can ease customers
in performing their financial transactions like internet and mobile banking.

Apparently, both internet and mobile banking are the services provided by banking
institution(s) toward their customers for the purpose of allowing bank customers to
perform financial related transactions seamlessly through online platform. The aim of
integrating the new system into their operation is to eradicate the obstacles faced by the
bank customers in avoiding long waiting lines. Through both internet and mobile
banking, bank customers are to be equipped with a variety of online features in which
they would be enabled to perform the financial activities, namely transfer payments,
online bill payments, check deposits and etc. The usefulness and ease of use of both
internet and mobile banking are perceived to ease banking transactions among bank
customers.

Though, the features in both aforementioned systems are most likely similar, yet there is
one major difference that distinguishes both systems. While internet banking requires

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the bank customers to login into their account through hardware device, such as
laptop /or computer that is, connected with the internet to perform the financial
transactions, mobile banking could enable the bank customers to perform the similar
financial transactions through mobile application that has been downloaded into their
smartphones [ CITATION Axi17 \l 17417 ]. Thereof, mobile banking has been perceived to
be more convenient to use compared to internet banking.

Nevertheless, in spite of the prevalent fact, the adoption of mobile banking among bank
customers has been considerably low. The inability of customers to perform certain
financial transactions and lack of security has been deemed to be the main factors
behind the low adoptions of mobile banking among bank customers.

In India, bank customers have been found to face some difficulties with regard to
restrictions in performing certain financial transaction(s). Based on the interview
sessions with bank managers in a particular Indian district, Swaminathan [CITATION
Ket17 \n \t \l 17417 ] has discovered that customers are highly reliant on the counter
face to face interaction in order to perform the banking transactions.

Similarly to the findings above, Jones [CITATION Rup16 \n \t \l 17417 ] has also found
that British bank customers are also inclined to physically attend the branch offices
when it comes to the highly complex transaction(s).

Prior to the restriction on mobile banking features(s), it results at bank customers to

have low intention in accepting the use of mobile banking into their lives.

Nevertheless, restriction on mobile banking features is only the least of the factors
behind the low adoption of mobile banking. In fact, the actual reasons that stimulate the
reluctance of bank customers to adopt mobile banking are due to the security and/or
safety issues.

Apparently, the concern toward mobile banking safety among bank customers has been
on the rise. Prior to the safety issues, it has reduced the intention of bank customers
toward mobile banking adoption.

According to the recent survey by Crosman [CITATION Pen16 \n \t \l 17417 ] in the

United States, the findings have indicated that the resistance of bank customers toward
mobile banking adoption is due to the perception that banks and financial institutions

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have not taken appropriate measures and actions to secure bank customers’ accounts
from being hacked. Being uncertain about the security actions taken by financial
institutions, bank customers are reluctant to use mobile banking, which have led to low
adoption of mobile banking.

Also, the survey by Marous [CITATION Jim16 \n \t \l 17417 ] indicated corresponding

findings with Crosman [CITATION Pen16 \n \t \l 17417 ] where the surveys’ results
shown that American bank customers are less likely to adopt mobile banking into their
lives.

In addition, the survey by Morely [CITATION Kat16 \n \t \l 17417 ] revealed the similar
findings where a certain number of British bank customers prefer to perform their
financial transactions conventionally that is, through bank teller.

Prior to the safety issue(s), it has made bank customers to oppose the use of mobile
banking into their lives.

Technically, the low tendency of bank customers in adopting the mobile banking is
considerably acceptable. In fact, the number of mobile banking fraud has gradually
increased over the years.

According to Brignall [CITATION Mil15 \n \t \l 17417 ] , both internet and mobile banking
fraud have been the most crime activities that occurred in European countries,
especially in the United Kingdom. On the past few years, the banking institutions in the
United Kingdom has disclosed that most of their customers’ online banking account
have been infiltrated, which in turn, resulting at monetary loss. On 2014, the amount of
money lost prior to defraud of internet and mobile banking was £60m and apparently
has doubled up to £130m on 2015.

In particular, the online fraudulent activities are majorly caused by the existence of
malware. Literally, malware is defined as the software application by which it is
designed for fraudulent purposes and used to steal individuals privacy information, such
as their banking account password [ CITATION Marnd \l 17417 ] , which resulting at
monetary losses. Due to its negative impact, the existence of malware has been
perceived as harmful for majority of people.

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On the recent survey by Kapersky Lab (2015) as cited by Crosman [CITATION Pen16
\n \t \l 17417 ], it has been found that there has been an increasing in the number of
malware designed for infiltrating the mobile banking account of worldwide bank
customers.

In Germany, the Dutch Banking Association recorded that banking institutions have

suffered significant losses on 2014 in regards to the malware infections [ CITATION
Ris15 \l 17417 ].

In United Kingdom, the Action Fraud and the City of London Police revealed that
malware attacks have accounted forty one percent of crime activities that occurred in
the banking industry [ CITATION Act16 \l 17417 ].

In Australia, malware attacks have been reported as the major crime activity. According
to ESET (2016) as cited by Whigham [CITATION Nic16 \n \t \l 17417 ] , the fraudulent
activities in regards to the malware attacks have recently occurred in most of the largest
banking institutions in Australia.

While in Asia region, the malware attacks toward mobile banking has been on the rise.
On 2014, The Association of Banks in Singapore has revealed that there has been an
increasing of malware attacks toward mobile banking account as compared to the
previous year [CITATION ABS15 \l 17417 ]. In addition, MyCERT has also reported
malware infections as the major crime activity encountered in Malaysia [ CITATION
Cyb14 \l 17417 ].

As the number of occasion in regards to malware attacks have been accelerated in the
fast pace over the years, thus it is necessarily important for banking institutions to
improve the safety on their mobile banking systems.

Although, the banking institutions nowadays have attempted to improve the safety level
of their online banking systems regularly, yet it still uncertain on whether the bank
customers would willing to adopt the use of mobile banking.

Hence, the purpose of this study is to identify the factors by which it would stimulate
the intention of bank customers toward mobile banking adoption in Kuala Lumpur. To
better understand the intention of bank customers in Kuala Lumpur to accept the use of
mobile banking, this study is to adapt the variables under Technology Acceptance

4
model (TAM). By doing so, the aim of researcher is to discover the precise factor(s) of
bank customers’ intention toward mobile banking adoption in Kuala Lumpur.

1.2 Problem Statement

Although, technology has dramatically advanced and made the daily life activities to be
easily carried out, still it seems that there is some resistance toward mobile banking
adoption among worldwide people. In fact, the past research had revealed multiple
disclosures on internet and mobile banking adoption among global bank customers.

In Italy, Italian bank customers have been found to fully accept the use of mobile
banking (Fenu and Pau, 2015). In Greece, Santouridis and Kyritsi [CITATION Ili14 \n \t \l
17417 ] have also discovered highly adoption of internet banking among Greeks bank
customers. Nevertheless, Stoica et al. [CITATION Ovi15 \n \t \l 17417 ] who procured
study on electronic banking adoption among Romanian bank customers has revealed
intriguing result(s) as it found that (most of) the banks, instead of the customers, are
defying the use of neither internet nor mobile banking.

Whereas, in Asia, there has also been found quite a number of research pertaining to
internet and mobile banking adoption were conducted. Though, most findings indicated
that Asia bank customers are less likely to adopt internet and mobile banking.

In Taiwan, bank customers have been found to averse the use of mobile banking prior to
safety issues (Chen, 2013). In accordance with, Purwanegara et al. [CITATION Mus13
\n \t \l 17417 ] also discovered similar findings where Indonesian bank customers are
found to have low acceptance toward mobile banking.

However, the study procured in the neighbourhood country that is, Malaysia has
indicated different results. Apparently, the research findings claimed that Malaysian
bank customers’ have high acceptance toward mobile banking.

For instance, Ling et al. [CITATION Goh16 \n \t \l 17417 ] who conducted study in
Malacca discovered that Malaysian bank customers are likely to accept internet banking
prior to its usefulness and perceive security to be insignificant. Likewise, the findings of

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Masrek et al. [CITATION Moh14 \n \t \l 17417 ] also shown high adoption of mobile
banking among Malaysian bank customers (who resides at Klang Valley).

Nonetheless, the findings of Hong et al. [CITATION Hon13 \n \t \l 17417 ] indicated that
Malaysian bank customers to have low intention toward internet and mobile banking
adoption as it is unsecure and prefer to use conventional way(s) to perform their
financial related transactions, especially for those who are under the generation of baby
boomers (Chin et al., 2013).

Although, the number of research pertaining to mobile banking adoption among bank
customers had been done, yet the results found seem to be inconsistent. As can be seen,
the studies, which were conducted in European has revealed contradicting relationship
with those in Asian.

Though, the studies initiated by Ling et al. [CITATION Goh16 \n \t \l 17417 ] and Masrek
et al. [CITATION Moh14 \n \t \l 17417 ] indicated the willingness of Asian bank
customers (Malaysian) to use mobile banking, yet other researchers from the same
country have found dissimilar findings where the (Malaysian) bank customers are
discovered to resist the adoption of both internet and mobile banking (Hong et al., 2013
& Chin et al., 2013).

Since, it is found that there is an inconsistency in the findings of mobile banking

adoption in Malaysia, thus the aim of researcher in this study is to identify the factors
that would trigger the intention of Malaysian bank customers toward mobile banking
adoption in a larger scale.

Rather than focusing on one district /or country state(s), the researcher of this study
would focus on the bank customers who reside at capital city. The decision to opt for
capital city is due to the greater number of banking institutions, thereby allowing the
researcher to obtain a better number of respondents and highly acceptance of people
toward sophisticated technology as compared to those at country state(s).

As the researcher is taking highly generalizable data and specific antecedents into his
account, thus he decided to choose Kuala Lumpur as the place of procurement to collect
and discover the actual influences of Malaysian bank customers toward mobile banking
adoption.

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1.3 Research Questions
RQ1: What is the relationship between perceived usefulness and mobile banking
adoption among Malaysian bank customers?
RQ2: What is the relationship between perceived ease of use and mobile banking
adoption among Malaysian bank customers?
RQ3: What is the relationship between perceived risk and mobile banking adoption
among Malaysian bank customers?

1.4 Research Objectives

RO1: To identify the relationship between perceived usefulness and mobile banking
adoption among Malaysian bank customers.
RO2: To identify the relationship between perceived ease of use and mobile banking
adoption among Malaysian bank customers.
RO3: To identify the relationship between perceived risk and mobile banking adoption
among Malaysian bank customers.

1.5 Hypotheses
Ha1: There is a significant relationship between perceived usefulness and mobile
banking adoption among Malaysian bank customers.
Ha2: There is a significant relationship between perceived ease of use and mobile
banking adoption among Malaysian bank customers.
Ha3: There is a significant relationship between perceived risk and mobile banking
adoption among Malaysian bank customers.

1.6 Significance of Study

The advancement in technology has changed the business worldwide. Prior to highly
sophisticated technology, it has enabled people to accomplish their activities /or tasks
without the need to be physically present in the location. Henceforward, with the
existence of technology, it allows people to comfortably perform their errands from
enjoyable place with the lowest cost possible.

However, the radical change in technology has brought up some safety issues where
people become vulnerable toward the online viruses /or malware infections. Being

7
infected with online viruses /or malware could have violated the personal information of
certain people, which in fact, could be harmful for their personal financial accounts.
Hence, people nowadays have been engulfed with anxiety of their personal information
to be stolen by anonymous party who is intended to infiltrate their personal financial
accounts.

In regards to the prior concern, it results at people (bank customers) to have low
intention to adopt online financial application, which apparently included mobile
banking. Nevertheless, the factors to affect the adoption of online financial application,
such as mobile banking are not solely determined by the safety factor. In fact, there are
some other factors that would affect the adoption of mobile banking among bank
customers.

Therefore, this study is conducted for the purpose of identifying the actual determinants
that are stimulating the intention of bank customers in Kuala Lumpur toward mobile
banking adoption. As a result, the findings of this study would be beneficial for banking
institutions in Malaysia to refer to.

Upon the procurement of this study, the results obtained can be utilized by banking
institutions to adjust the features /or safety in their mobile banking applications with the
expectation of bank customers.

Technically, if the findings revealed that Kuala Lumpur bank customers are highly
concerned with the features (usefulness) of mobile application, thus the banking
institutions might want to further emphasize on features innovation of their mobile
banking application rather than focused on the safety matter and vice-versa.

This way, it would enable banking institutions to provide mobile banking application
that is, fitted with the needs of Kuala Lumpur bank customers and therefore increasing
their satisfaction level toward their respective banking institutions.

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 CHAPTER 2

LITERATURE REVIEW

This chapter provides the variables of this research, which are independent variables
and dependent variable. In this research, the independent variables used are perceived
usefulness, perceived ease of use and perceived risk, while intention to use mobile
banking is acted as the dependent variable. In addition, both theoretical and conceptual
frameworks are provided under this chapter.

2.0 Intention to Use Mobile Banking

Intention to use is defined as the tendency of individuals toward the use of latest

information technology system [ CITATION Tsa12 \l 17417 ]. While in this research, the
intention to use is described as the level of acceptance /or willingness of one individuals
to adopt the highly sophisticated technology system that is, mobile banking application
into their lives. Previous studies on mobile banking adoption, in fact, had been done by
the past researchers.

In the research conducted by Shen et al. [CITATION Yun10 \n \t \l 17417 ] , perceived risk
and perceived behavioural control that is, the variable under theory of planned
behaviour (TPB), were used to identify bank customers’ acceptance toward mobile
banking.

While, Mohammadi [CITATION Hos15 \n \t \l 17417 ] used perceived ease of use and
perceived usefulness, the variables under technology acceptance model (TAM), and
risk, to understand the factors to affect Iranian bank customers from adopting mobile
banking, Sohail and Al-Jabri [CITATION MSa13 \n \t \l 17417 ] tested whether both

9
perceived ease of use and risk are influencing the attitudes of users and non-users in
Saudi Arabia toward mobile banking acceptance.

Apparently, earlier studies on mobile banking adoption had empirically been done, yet
the number of study on mobile banking adoption is considerably low. In fact, most of
the previous studies were focusing toward the acceptance of internet banking among
bank customers. This phenomenon might be due to the fact that mobile banking
application has only been developed in the recent years, which therefore resulting at a
few studies on mobile banking adoption can be discovered.

Hence, the aim of this study is to identify the salient factors toward mobile banking
adoption among (Malaysian) bank customers. In particular, perceived ease of use,
perceived usefulness and perceived risk are the independent variables used to identify
the dependent variable that is, intention to use mobile banking.

2.1 Perceived Usefulness

Perceived usefulness is defined as the belief of individuals that the adoption of certain
technology into their lives would develop /or improve their performance and efficiency
in accomplishing their daily tasks [CITATION Fre89 \l 17417 ]. Theoretically, perceived
usefulness is part of variables under technology acceptance model that is, particularly
used to determine the level of individuals’ intention to use certain technology. Prior to
its relevance in determining the mobile banking adoption among bank customers, thus
perceived usefulness is deemed to be appropriate independent variable and used to
determine the bank customers’ intention to use mobile banking in this research.

Past studies had used perceived usefulness to identify the importance of features in
influencing bank customers’ intention toward online banking services adoption.

In particular, perceived usefulness has been deemed to be the utmost paramount driver
to affect the bank customers in Egypt, Saudi Arabia and Jordan in adopting internet
banking into their lives (Al-Qeisi & Hegazy, 2015). In addition, the findings of Sharma
et al. [CITATION Sha17 \n \t \l 17417 ] revealed perceived usefulness to have positive
relationship toward mobile banking adoption and thus affecting Omani bank customers’
intention to use mobile banking. Tran and Corner [CITATION Tra16 \n \t \l 17417 ] who

10
conducted study on impact of communication channel toward mobile banking adoption
also found positive relationship between perceived usefulness and mobile banking
adoption among New Zealand bank customers. In conjunction with, the findings of
Gupta and Arora [CITATION Gup17 \n \t \l 17417 ] also revealed perceived usefulness to
influence the adoption of mobile banking among Indian bank customers, although
certain bank customers still against the adoption of mobile banking into their lives.

Therefore, perceived usefulness /or features can be considered as significant driver of

internet and mobile banking adoption among Asian and Middle East bank customers.

Yet, on the other studies, the researchers indicated perceived usefulness to have no
relationship and became insignificant factor toward the adoption of mobile banking
among bank customers.

In Pakistan, Gilal et al. [CITATION Gil15 \n \t \l 17417 ] found that perceived usefulness
apprehended to be unnecessary among Pakistani bank customers. Likewise, Munoz-
Leiva et al. [CITATION Lei16 \n \t \l 17417 ] who procured study on mobile banking
adoption among Spaniard bank customers discovered perceived usefulness to have no
relationship with their intentions to adopt mobile banking.

Eventually, prior to the inconsistency results on the previous studies, hence the current
researcher decided to use perceived usefulness as the independent variable and test its
relationship with the dependent variable in this research that is, intention to use mobile
banking.

Using this variable, the aim of current researcher is to determine the necessary of
perceived usefulness in triggering the intention to use mobile banking among Malaysian
bank customers.

Hence, to identify the relationship between perceived usefulness and intention to use
mobile banking in this research, the constructed hypothesis is as below.

Ha1: There is a significant relationship between perceived usefulness and mobile

banking adoption among Malaysian bank customers.

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2.2 Perceived Ease of Use

Perceived ease of use is described as the degree in which people believe by using
certain technology system is easy and therefore they would be effortlessly in using it
(Davis et al., 1989). In particular, perceived ease of use is part of variables under
technology acceptance model that is, particularly used to determine the level of
individuals’ intention to use technology based application. According to Davis et al.
[CITATION Fre89 \n \t \l 17417 ] , perceived ease of use indicated that people would be
more likely to accept technology when they comprehend that it can be used seamlessly.
Prior to its relevance in determining the mobile banking adoption among bank
customers, thus perceived ease of use is deemed to be appropriate independent variable
and used to determine the bank customers’ intention to use mobile banking in this
research.

Past studies had used perceived ease of use to identify the importance of simplicity in
influencing bank customers’ intention toward online banking services adoption.

For instance, the study of Koksal [CITATION Kok16 \n \t \l 17417 ] on Lebanese bank
customers’ intention toward mobile banking adoption considered perceived ease of use
to be significant driver where it became the main determinant toward their adoption of
mobile banking. Also, Harrison et al. [CITATION Har14 \n \t \l 17417 ] whose study
focused on the internet banking acceptance among Scottish bank customers discovered
that perceived ease of use to be necessary and hence have the positive relationship
toward internet banking acceptance. Similarly, perceived ease of use has as well been
found to have positive relationship with the usage of mobile banking among Jordanian
bank customers (Alsamydai et al., 2014).

12
Therefore, perceived ease of use /or simplicity can be considered to be another
significant driver of both internet and mobile banking adoption, in this case, among
Britannia and Middle East bank customers.

Yet, on the other studies, the researchers revealed perceived ease of use to have no
relationship and became insignificant factor toward the adoption of internet and mobile
banking among bank customers.

For instance, the findings of Shanmugam et al. [CITATION Sha14 \n \t \l 17417 ] on

Malaysian behavioural intention to use mobile banking revealed perceived ease of use
to have negative relationship, which in turn, indicated that perceived ease of use to have
no effect /or impact toward mobile banking adoption among Malaysian bank customers.
Likewise, Maditinos et al. [CITATION Dim13 \n \t \l 17417 ] who initiated research on
internet banking acceptance discovered perceived ease of use to have negative
relationship and thus did not affect Greeks bank customers to adopt internet banking. It
is due to the fact that Greeks bank customers are more concerned on the security issue.
In accordance with, perceived of use has also been found to be the least important factor
to affect the adoption of mobile banking among Taiwanese bank customers [ CITATION
YuC12 \l 17417 ].

Prior to the inconsistency results on the previous studies, hence the current researcher
decided to use perceived ease of use as the independent variable and test its relationship
with the dependent variable in this research that is, intention to use mobile banking.

Using this variable, the aim of current researcher is to determine the necessary of
perceived ease of use in triggering the intention to use mobile banking among
Malaysian bank customers.

Hence, to identify the relationship between perceived ease of use and intention to use
mobile banking in this research, the constructed hypothesis is as below.

Ha2: There is a significant relationship between perceived ease of use and mobile
banking adoption among Malaysian bank customers.

13
2.3 Perceived Risk

Perceived risk is defined as the degree by which individuals believes the adoption of
certain system would be resulted in unfavourable outcome (Null et al., 2011). In
particular, perceived risk has considerable impact to determine whether one individuals
is to use technology system. Apparently, for some people, technology is perceived to be
unsecure as it could lead to monetary loss. In fact, certain individulas comprehend
technology to have no solid protection in which it could guarantee their safety. This in
turn inducing at particular individuals to have no intention to intergrate the use of
technology into their lives. Prior to its significance in determining the mobile banking
adoption among bank customers, thus perceived risk is deemed to be important
independent variable and used to determine the bank customers’ intention to use mobile
banking in this research.

Past studies had used perceived risk to identify the importance of safety in influencing
bank customers’ intention toward online banking services adoption.

In the study by Al-Ajam and Nor [CITATION AlA15 \n \t \l 17417 ] on adoption of internet
banking service among Yemenis bank customers, the findings indicated there is a
significant positive relationship between perceived risk and intention to use internet
banking. The findings of Al-Smadi [CITATION AlS12 \n \t \l 17417 ] also revealed that
perceived risk to have positive relationship and thus affecting the electronic banking
adoption among Jordanian bank customers. In conjunction with, perceived risk has been

14
found to be the primary determinant of mobile banking adoption among Australian and
Thai bank customers (Mortimer et al., 2015).

Therefore, perceived risk /or safety can be deemed as significant determinant toward
internet and mobile banking adoption among Asian and Middle East bank customers.

Notwithstanding, on the other studies, the researchers revealed that perceived risk to
have no relationship and became insignificant factor toward the adoption of internet and
mobile banking among bank customers.

The findings of Tan and Lau [CITATION Tan16 \n \t \l 17417 ] revealed perceived risk to
be the least important factor to be considered and thus have no effect toward mobile
banking adoption among Malaysian bank customers. Likewise, Laukkanen [CITATION
Lau16 \n \t \l 17417 ] discovered perceived risk to have no relationship and thus became
unnecessary determinant to affect the adoption of both internet and mobile banking
among Finns bank customers. In accordance with, perceived risk has also been deemed
to have no importance toward internet banking usage among Turkish bank customers
(Daneshgadeh & Yıldırım, 2014).

In regards to the inconsistency results on the previous studies, hence the current
researcher in this study decided to use perceived risk as the independent variable and
test its relationship with the dependent variable in this research that is, intention to use
mobile banking.

Using this variable, the aim of current researcher is to determine the necessary of
perceived risk in affecting the intention to use mobile banking among Malaysian bank
customers.

Hence, to identify the relationship between perceived risk and intention to use mobile
banking in this research, the constructed hypothesis is as below.

Ha3: There is a significant relationship between perceived risk and mobile banking
adoption among Malaysian bank customers.

15
2.4 Theoretical Framework

Figure 2.1 Technology Acceptance Model (TAM)

Figure 2.1 shows the theoretical framework of this research. The conceptual framework
of this research is modified from Technology Acceptance Model. Using Technology
Acceptance Model, the researcher aim is to understand the intention of Malaysian bank
customers to use mobile banking.
Particularly, Technology Acceptance Model comprises of two independent variables
namely perceived usefulness and perceived ease of use. These two factors are deemed
to affect the attitude and intention to use certain technology, which in fact, lead to the
actual use of the system. (Davis, 1980)
Apparently, Technology Acceptance Model has been apprehended to be one of the
oldest theoretical models used to comprehend the individuals’ acceptance toward
technology. Since its existence, Technology Acceptance Model has been considered as

16
one of the most powerful theories to predict the behavioural intention of individuals to
accept the use of technology into their lives. [ CITATION Sur12 \l 17417 ]
Moreover, Technology Acceptance Model has been proven as framework with the
most significant variables to identify the usage of technology by individuals in different
contexts (Munoz-Leiva et al., 2016; Mohammadi, 2015; Koksal, 2016; Alsamydai et
al., 2014).
Prior to its relevance, the current researcher decided to integrate the independent
variables under Technology Acceptance Model into the current research. In addition,
perceived risk would be another independent variable used to identify the dependent
variable in this research.
Therefore, perceived usefulness, perceived ease of use and perceived risk are the
independent variables used to identify their relationship with the dependent variable in
this research that is, intention to use mobile banking.
2.5 Conceptual Framework

Independent Variables Dependent Variable

Perceived Usefulness Ha1

Perceived Ease of Use Intention to use

Ha2 mobile banking

Ha3
Perceived Risk

Figure 2.2 Conceptual Framework of the research: Investigating the Antecedents of Customers’
Intention toward Mobile Banking Adoption in Kuala Lumpur

17
Figure 2.2 shows the conceptual framework of this research. It depicts that perceived
usefulness, perceived ease of use and perceived risk as the factors in which it would
affect the Malaysian bank customers’ intention toward the use of mobile banking.

CHAPTER 3

RESEARCH METHODOLOGY

Under this chapter, the information in relation to research and sampling design (consists
of population study, sample and sampling distribution, sampling method and sampling
technique) used in this research would be presented. Also, under this chapter, the
variable measurement and data analysis namely descriptive analysis, normality test,
reliability test, Pearson correlation analysis and Multiple regression analysis are to be
provided.

3.1 Research Design

This is a hypothesis testing study under quantitative approach. In this research, data
collected will be converted into numerical form to identify the relationship between
independent variables and dependent variable. Thus, the correlation analysis will be
performed in order to discover the relationship between independent variables and
dependent variable in this research. Moreover, this is a cross-sectional study where the
research would only be conducted for one single time to solely answer the research
questions. Thereof, cross-sectional study is considered as the most appropriate study to

18
be used. In addition, the unit of analysis in this study is focused on Malaysian bank
customers who are residing at Kuala Lumpur.

3.2 Sampling Design

In this section, the targeted population of this research would be shown. In particular,
this section would depict the sample and sampling distribution, sampling method and
sampling technique used in this research.

3.2.1 Population of Study

In this research, the targeted population is Kuala Lumpur bank customers. The decision
to opt Kuala Lumpur bank customers as the targeted population is due to the great
number of banking institutions, which therefore enabling the researcher to obtain data
from the qualified respondents. Henceforth, the researcher decided to choose the Kuala
Lumpur bank customers as they are deemed as being the most appropriate candidates to
be the population of this study as compared to the bank customers in the country
state(s).

3.2.2 Sample and Sampling Distribution

Department of Statistics Malaysia, Official portal (2017) recorded that the population of
Kuala Lumpur in 2017 is 1.79 million. Given the enormous population in Kuala
Lumpur, thus it might not be possible if the researcher has to target every single person
who lives in Kuala Lumpur due to the time constraint and considerable effort that is,
needed to be put in. However, it is necessarily paramount to obtain the right amount of
respondents in the research.

According to Sekaran and Bougie (2010), to consider the right amount of respondents in
a research, it has to follow the extent of precision and confidence desired, thus enabling
the sample size in a research to be withdrawn.

19
Following the aforementioned statement, thus the researcher is to use the calculation of
Survey Monkey. Survey Monkey itself is a software calculator that is, used to generate
the right amount of respondents needed in a study by inserting the necessary
information namely level of confidence and population size used in the study.

Using Survey Monkey (2017), the sample size in this study is 385 with the sampling
error of no more than 5% at the confidence level of 95%. Moreover, the respondents are
randomly selected from the Malaysian bank customers who resided in Kuala Lumpur.
In addition, the respondents in this research are covering both genders, which are male
and female. Nevertheless, due to the time and budget constraint, the sum of 200
respondents are expected to be the minimum number of respondents in this research.

3.2.3 Sampling Method and Sampling Technique

In this research, convenience sampling is the sampling method used. Convenience

sampling is a non-probability sampling method. This method is preferred because it
enables researcher to collect data easily, within timely manner and budget control
(Dörnyei, 2007).

In this research, questionnaires would be distributed to the people who resided in Kuala
Lumpur. Pedestrian streets, education institutions, housing areas, banking areas and
shopping areas that are located in Kuala Lumpur are some of the locations where
questionnaires are going to be scattered. However, public transportation areas are to be
excluded from the list of questionnaires distribution. As of the people who use public
transportation tend to be in hurry, thus the questionnaires they filled up might not reveal
their actual opinion toward their intention to adopt mobile banking. Prior to the
particular reason, the questionnaires distribution would not be performed in the
prevalent location.

Furthermore, both conventional and online methods would be used for data collection
purposes.

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As being mentioned above, the questionnaires would be dispersed in the residences,
education places, banking areas and etc. Prior to the great traffic of passer-by, the
prevalent locations have then been perceived to be the most potential locations for data
collection of this research.

Moreover, the questionnaires are also distributed through the online platform. In this
research, Google Forms is used as the survey form where it provides the question by
which respondents need to answer. After the Google Forms have been prepared, it is
then being sent out through the online platforms, such as E-mail and Facebook. Through
these platforms, all potential respondents are subjected to use the self-administrative
method where they are to answer the questions available by themselves. Yet, necessary
explanation would be given, in case, respondents do not understand with some
question(s) in the questionnaires.

3.3 Variable Measurement

There are total 27 items in the questionnaire in which it relates to both independent
variables (perceived usefulness, perceived ease of use and perceived risk) and
dependent variable (intention to use mobile banking). Particularly, all questions as
shown in the questionnaire are adapted from different previous published researches.
The adaptation of questionnaire from past researchers, which later being modified based
on the needs of this study is meant for assuring the credibility of questionnaire. As of
the past researchers have procured preliminary testing on the questions used in the
questionnaire, thus the designed questions could then be considered to be appropriate
and relevant to be used in identifying the relationship between independent variables
(perceived usefulness, perceived ease of use and perceived risk) and dependent variable
(intention to use mobile banking). (Sekaran and Bougie, 2010)

Furthermore, both ordinal and nominal scales are used in the Section A of this
questionnaire. According to Sekaran and Bougie (2010), ordinal scale, apart from, being
used to categorize the variables, it can also be used to rank the variables in the
meaningful ways, whereas nominal scale is to allow the researcher to assign the subjects
to particular categories or groups. Hence, in this research, ordinal scale is being used to

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measure the age group of respondents. While nominal scale is being used to categorize
the respondent into different group according to different demographic factors.

Variables Codes
Nationality 1= Malaysian
2= Non-Malaysian
Gender 1= Male
2= Female
Age 1= 18 - 24 years old
2= 25 - 34 years old
3= 35 - 44 years old
4= 45 years old or above
State 1= Kuala Lumpur
2= Selangor
3= Johor Bahru
4= Penang
5= Malacca
6= Others
Ethic Group 1= Malay
2= Chinese
3= Indian
4= Others
Highest Level of Education 1= High School Graduate
2= Diploma
3= Bachelor’s Degree
4= Master’s Degree
5= Professional Degree ((MD, Ph.D., Ed.
D., J.D., etc)
Salary 1= Below RM1,000
2= RM1,000 – RM1,999
3= RM2,000 – RM2,999
4= RM3,000 – RM3,999
5= RM4,000 – RM4,999
6= Above RM5,000
Table 3.1 Coding for Demographic Data

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In addition, Likert 5 points scale is used for all questions in the section B (of the
questionnaire). Likert 5 points scale by which ranging from 1 to 5 is designed to
evaluate the extents of the respondents’ subjective agreement or disagreement towards a
particular statement (Sekaran and Bougie, 2010). Particularly, it consists of “strongly
disagree =1” to “strongly agree = 5”.

Section Content Usefulness Question Range

A Personal Data To identify the Question 1-6
Information personal data
information of
respondents.
B Perceived To identify the Question 7-11
Usefulness relationship
between perceived
usefulness and
intention to use
mobile banking
among Malaysian
bank customers.
Perceived Ease of To identify the Question 12-16
Use relationship
between perceived
ease of use and
intention to use
mobile banking
among Malaysian
bank customers.
Perceived Risk To identify the Question 17-21
relationship
between perceived
risk and intention to
use mobile banking
among Malaysian
bank customers.

C Intention to Use To identify the Question 22-27

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 Mobile Banking relationship of
intention to use
mobile banking
among Malaysian
bank customers.
Table 3.2 The usefulness of every section in the questionnaire

3.4 Data Analysis

Data analysis is the process of analysing and interpreting the collected data into
meaningful information. Therefore, some analysis namely pilot testing, descriptive
analysis, normality test, reliability test, Pearson’s Correlation analysis and Multiple
Regression analysis would be conducted for fulfilling the particular purposes.

3.4.1 Pilot Testing

In order to assure the credibility of questions used and rectify the existing errors in the
questionnaire, pilot testing is to be procured. As the questions used in the questionnaire
of this research is being adapted from past studies, thus the procurement of pilot testing
would be paramount in assessing whether the modified questions used in the
questionnaire have been formatted and designed, in a way, they can be understood by
the respondents. As the understanding of respondents toward the questions is
necessarily significant in determining the respondents’ actual opinion toward the
independent and dependent variable(s) in this research, thus the existence of pilot
testing has been perceived to be important.

Apparently, the pilot testing would be performed among 30 UCSI University students
(who are voluntarily aid in testing the credibility of questionnaire) where every one of
them is entailed to provide feedback associated with the design of questionnaire.
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Henceforth, any necessary correction would be done on the respective part of
questionnaire where errors are discovered.

Consequently, through pilot testing, it would enable researcher to design appropriate

questionnaire that is, understandable among respondents.

3.4.2 Descriptive Analysis

In the process of analysing and interpreting the collected data, descriptive analysis
would be conducted. Literally, descriptive analysis is the process in which the collected
(raw) data is to be transformed into the form that allows the data itself to be
understandable and interpretable (Sekaran and Bougie, 2010).

By conducting descriptive analysis, it would reveal information, such as maximize

score, minimize score, standard deviation, means, frequency distribution and range of
the scores by which each of the aforementioned analysis would be interpreted into the
meaningful information.

In particular, every analysis procured under descriptive analysis has significance in

elaborating the respondents’ information. The background of information namely
demographic and respondents’ opinions toward intention to use mobile banking can be
explained using this analysis.

In the minimize score, it would reveal the information in regards to respondents’ least
opinion toward intention to use mobile banking. On the other hand, maximize score
would show the respondents’ most opinion toward intention to use mobile banking,
which ranging from strongly disagree to strongly agree. Through standard deviation and
means, it would tell the measurements of respondents’ data dispersion in this research.
A low standard deviation would indicate that most of the respondents’ opinions are very
close to the average, whereas the range of respondents’ opinions are indicated to be

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spread out if the standard deviation is high. In addition, through frequency distribution,
it would define the information regarding the category group in which respondents are
in.

Henceforth, through descriptive analysis, the normality of spreading data and existing
illegal entries can be identified, thus allowing the researcher to perform any necessary
rectification if the issues as prescribed are discovered.

3.4.3 Normality Test

Normality test is used to identify whether the sampling distribution in this research is
normally distributed. The normally distributed data would be important in indicating the
collected data is apparently representing the actual population (of respondents) in this
research.

In this research, the normality test will be determined based on the Skewness and
Kurtosis obtained.

Literally, Skewness refers to a measure of symmetry or distribution that is, used to

measure the probability in the tails (Nist, n.d.). According to Bulmer (1979) as cited by
Brown (2017), the range of Skewness that is, less than −1 or greater than +1 is
perceived to be highly skewed, moderately skewed if the range of Skewness is in
between −1 and −½ or between +½ and +1 and approximately symmetric if the range of
Skewness is in between −½ and +½.

In addition, in Kurtosis, it reveals the measure of whether the data obtained and used in
the research are heavy-tailed or light-tailed relative to a normal distribution (Excel,
2016). According to Cramer (1979) as cited by Brown (2017), the range of Kurtosis that
is, less than -2 would indicate the population very likely has negative excess kurtosis,
neutral kurtosis if the range of Kurtosis is in between −2 and +2 and the population very
likely has positive excess kurtosis if the range of Kurtosis is more than +2.

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Therefore, to ensure the data in this research is normally distributed, the collected data
needs to have Skewness ranging between -1.0 and +1.0 and for Kurtosis it should be
ranging between -2.0 and +2.0 only then the null hypotheses can be accepted and
indicated that the data is normally distributed.

Furthermore, Kolmogorov-Smirnov test would also be procured to test the normality of

data in this research as well as used to support the normality result(s) produced from
Skewness and Kurtosis.

Using Kolmogorov-Smirnov test, the normality of data would be determined based on

the p-value. According to Conover (1999) as cited by Razali and Wah (2011), data is
perceived to be normally spreading if the p-value is greater than 0.05, whereas it is
deemed to be different from the normal population if the p-value is lesser than 0.05.

Henceforth, the p-value in this research should be greater than 0.05, thereby indicating
that the data used in this research is normal and not significantly different from the
population.

3.4.4 Kaiser-Meyer-Olkin and Bartlett’s Test

Kaiser-Meyer-Olkin and Bartlett’s Test is literally referred to the statistical analysis in

which it is deployed to identify the adequacy of sampling and also to indicate the
significance relationship amid variables within the research (Griffin, n.d.).

Respectively, each of the prevalent statistical analysis is critically paramount for the
procurement of this research. While Kaiser-Meyer-Olkin is used to ensure that the
sample obtained and used in this research is sufficient and thus representing the actual
number of population, Bartlett’s Test is conducted to assess the level of correlation
between variables in this research.

For Kaiser-Meyer-Olkin, the closer the value to 1.0, it indicates that the sample in this
research is adequate and represents the actual number of population. Whereas, the value
that is, lower than 0.5 can be interpreted as non-representative sample where the
collected data only cover a small substance of population. (Griffin, n.d.)

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In addition, for Bartlett’s Test, the relationship of variables would be determined by the
p-value. According to Eric (2013), variables are deemed to be correlated if the p-value
is lower than 0.05, whereas it is perceived to be uncorrelated if the p-value is greater
than 0.05.

Therefore, the value to be obtained in this research should be above of 0.5 (for Kaiser-
Meyer-Olkin) and below of 0.05 (for Bartlett’s Test).

3.4.5 Reliability Test

Reliability test is used to measure the overall consistency and stability of the data,
which later being used to define a scale. The procurement of reliability test is
particularly meant to ensure the consistency of questions in the questionnaire. Through
reliability test, the part of questionnaire in which errors are likely to be occurred can be
easily pointed out. Henceforth, reliability test could then notify researcher the particular
area of errors and enable researcher to perform necessary amendment /or correction
before the final questionnaires are distributed to the respondents.

In this research, the reliability test used is Cronbach’s alpha. According to Matkar
(n.d.), there is a rule of thumb used to determine the level of acceptance of alpha value.
The closer the alpha to 1, it indicates higher internal consistency. While it is considered
as unacceptable if alpha is less than 0.5 and poor if alpha is in between 0.5-0.6 and
questionable if alpha is in between 0.6-0.7, acceptable if alpha is in between 0.7-0.8,
good if alpha is in between 0.8-0.9 and excellent if alpha is more than 0.9.

Therefore, the reliability coefficient of alpha value in this research should be in the
category of acceptable (0.7-0.8) in order to ensure that the results obtained are relevant
and reflecting the actual view of respondents.

3.4.6 Pearson’s Correlation Analysis

In this research, the relationship between dependent variable (intention to use mobile
banking) and independent variables (perceived usefulness, perceived ease of use and
perceived risk) would be tested through Pearson’s correlation analysis (using SPSS
version 21).

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Literally, Pearson’s correlation analysis is used to answer the research questions and
clarify the hypotheses in this research. By using Pearson’s correlation analysis, it allows
researcher to identify the relationship between dependent variable and independent
variables in this research.

For testing the hypotheses, the confidence level of 95% and 5% of error is perceived. In
the Pearson’s Correlation Analysis, the higher level of relationship indicates the positive
relationship whereas the lower level of relationship indicates the negative relationship
among independent and dependent variable(s).

According to Mukaka (2012), the coefficient <0.2 indicates negligible /or a very weak
relationship, coefficient of 0.2-0.4 indicates low /or weak relationship, coefficient of
0.4-0.7 indicates moderate relationship, coefficient of 0.7-0.9 indicates high /or strong
relationship and the coefficient of >0.9 indicates a very high /or strong relationship.

3.4.7 Multiple Regression Analysis

Multiple Regression Analysis is another analysis used to identify the relationship

between dependent variable and independent variables as well as to test the strength,
significance and relationship among variables in this research. Particularly, multiple
regression analysis would be conducted through SPSS version 21.

The procurement of Multiple Regression Analysis is predominantly meant to enable

researcher to gain more insights in regards to the strength, significance and relationship
between independent variables and dependent variables in this research.

By conducting Multiple Regression Analysis, it would reveal various data, such as

standard coefficient of beta, significant p-value and R-square (R2), which apparently
allowing researcher to further interpret the relationship among independent and
dependent variable(s) as well as the strength and significance for each of the variables in
this research.

Through standard coefficient of beta and significant p-value, it enables researcher to

identify the strengths and relationship for every independent variable with dependent
variable in this research. The higher level of standard coefficient of beta would indicate
strong relationship among independent and dependent variables in the research, whereas

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the significant p-value that is, less than 0.05 would indicate the positive relationship
between the variables.

In addition, through R-square (R2), the justification regarding to the significance of

independent variables used in this research in affecting the dependent variable can be
withdrawn.

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