Bashir 2015

Journal of Indian Business Research
Consumer attitude and behavioural intention towards internet banking adoption in India
irfan bashir Chendragiri Madhavaiah
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To cite this document:
irfan bashir Chendragiri Madhavaiah , (2015),"Consumer attitude and behavioural intention towards internet banking
adoption in India", Journal of Indian Business Research, Vol. 7 Iss 1 pp. -
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Consumer attitude and behavioral intention towards Internet banking
adoption in India
1. Introduction
Information and communication technology (ICT) has brought a remarkable

transformation in the delivery of financial services in general and retail banking services in
particular not only in developed countries but also in developing countries like India. This
transformation in ICT has led to the delivery of banking services in accordance with the
changing needs and preferences of consumers. Using Internet banking technology to serve
the consumers has become a tool for achieving competitive advantage in the industry by
making the banks more efficient (Mann and Sahni, 2012). Internet banking, a service
delivery method, introduced in 1994, has attracted increasing attention not only from
banking institutions but also from other accomplices in the financial services industry and
business organizations (Furst et al., 2002). Internet banking is a promising alternative
delivery channel which offers benefits to both banks and consumers. Banks get the benefits
like lower transactional costs, efficiency, retaining profitable consumer base, and extending
the market area. Consumers also get distinct benefits of Internet banking like convenience,
availability, accessibility, time and cost savings [1].
The efficiency in the delivery of Internet banking services can be achieved only
when consumers show preference for the adoption of this channel in addition to the quality
of infrastructure facilities available. According to McKinsey report [2], Internet banking
usage in India has increased from 1 per cent in 2006 to 7 per cent in 2011. As per another
survey of McKinsey [3] conducted in December 2012, India has about 120 million Internet
users, which is the third-largest in the world. The report further emphasised that India is
likely to have the second-largest user base in the world, and the largest in terms of
incremental growth, with 330 million to 370 million Internet users in 2015. According to
Internet World Stats [4], there are approximately 2.4 billion Internet users around the
world and 137 million Internet users in India. According to a report by Internet and Mobile
Association of India (IAMAI) and IMRB International [5], in June 2013, India had 190
million Internet users and by October, the number of Internet users reaches 205 million
and is estimated to reach 213 million by December 2013. Though, India is adopting the
Internet at a more rapid pace than developed and other developing countries, almost 83
per cent of its population is not yet connected with Internet [4]. Hence, it is clear that India
is a potential market for Internet banking services.
Despite the rapid proliferation of Internet in India, the expected adoption rate of
Internet banking among Internet users has been not growing proportionately. Although, 50
per cent of Indian Internet users were forecasted to be using Internet banking by 2012, the
actual number of Internet banking users was well behind the expected estimates.
According to a report by RBI, only 1 per cent of Internet users were active users of Internet
banking in 1998 which grew to 16.7 per cent in 2000 [6]. This shows that Internet banking
has experienced sustainable growth since its inception in India. However, the Internet
banking penetration rate in India has remained very low compared to other Asian
countries such as; China has around 300 million personal online banking users, as on June,
1
2012 [7], Malaysia has 2.7 million Internet banking users, followed by Hong Kong with 1.5
million users and Indonesia with 749,000 unique users as on January, 2011 [8].
Considering the huge investments made by banks in providing Internet banking
services, the success of this channel of service delivery ultimately depends on the
consumers’ acceptance and continued use. Thus, in order to enhance individual adoption of
Internet banking, first and foremost, banks need to have a clear understanding of the
Indian Internet banking users, in terms of their perception, attitude and intention in using
this self-service technology. In this context, an attempt is made in the present study to
examine the influence of beliefs, viz. trust, website design, enjoyment, and social influence
on consumers’ perceptions about usefulness, ease of use and risk of using Internet banking.
Further, the study is intended to determine the effect of this perception on attitude and
behavioral intentions of consumers to adopt Internet banking services.
The paper is organized as follows. The second section is presented with review of
literature containing theoretical background, research gap in Indian Internet banking

adoption, development of research model and hypotheses. In the third section,
methodology for the research is discussed in which questionnaire development, data
collection and data analysis tools are explained. In the fourth section, data analysis and
results are presented followed by discussion in the consecutive fifth section. In the sixth
section research contributions are discussed from three perspectives, viz., theoretical,
methodological and managerial perspectives. The paper concludes by highlighting the
limitations of the study that can be addressed in future research.
2. Review of literature
2.1 Theoretical background
Earlier, studies related to adoption of technology were conducted which sought to

understand how different factors affect the technology adoption behavior of individuals.
The main feature of these studies is that they attempt to explain and predict the
phenomena of technology adoption using theoretical models. Since there is dearth for such
kind of studies in information technology domain, all these theories have come from the
field of social psychology. During later years these theories were modified to elicit the
factors affecting the technology adoption behavior. According to the classification of
Hanafizadeh et al., (2014), basic theories and their extensions in the field of technology
adoption are as follows:
Basic theories related to social psychology
• Theory of reasoned action (TRA; Fishbein and Ajzen, 1975)

• Theory of planned behavior (TPB; Ajzen, 1985)
• Social cognitive theory (SCT; Bandura, 1986)
• Commitment-trust theory (CTT; Morgan and Hunt, 1994)
• Perceived risk theory (PRT; Roselius, 1971)
Theories/models extended to explain technology adoptions

2
• Innovation diffusion theory (IDT; Rogers, 1983)
• Technology acceptance model (TAM; Davis, 1989)
• Decomposed theory of planned behavior (DTPB; Taylor and Todd, 1995)
• Extended technology adoption model (TAM2; Venkatesh and Davis, 2000)
• Unified theory of acceptance and use of technology (UTAUT; Venkatesh et al., 2003).
Each of these theories offers new insights into acceptance and use of technology at both
individual and organizational levels. Among these theories, TAM is most widely applied
theory in understanding individuals’ beliefs towards acceptance and use of technology
because it specifically focuses on information system use; it is rooted on social psychology
theory; and it shows parsimony and has received extensive empirical support. Originally,
TAM was developed to test the acceptance of word-processor technology among IBM
employees (Davis et al., 1989). However, in recent years, TAM has accumulated strong
empirical support for its explanatory power in the context of e-commerce, personal
computers, the world wide web (www), mobile commerce/payment, database
management systems (DBMS), broadband and telemedicine technology (Agarwal and
Karahanna, 2000; Vijayasarathy, 2004; Chen et al., 2002; Tan and Teo, 2000; Wu and Wang,
2005; Chen, 2008; Oh et al., 2003; Wu et al., 2007; Mathieson, 1991; Szajna, 1994; Igbaria et
al., 1995; Chau and Hu, 2001). Moreover, TAM has become a widely used model for
predicting the acceptance and use of self-service banking such as mobile banking, Internet
banking, telephone banking and ATMs (Martins et al., 2014; Zhou, 2011; Abbad, 2013; Lee,
2009; Celik, 2008; Yousafzai and Yani-de-Soriano, 2012, Chiou and Shen, 2012; Yang and
Zhou, 2011).
Technology acceptance model, an adaptation of TRA theory, was specifically tailored
to explain information technology acceptance. TAM posits that technology usage is directly
determined by behavioral intention of an individual, which is, in turn, influenced by users’
attitude towards technology, perceived usefulness and perceived ease of using the
technology. In addition, perceived ease of use is hypothesized to influence attitude and
perceived usefulness. Other external variables, if any, are believed to exert their influence
on attitude and intention through perceived usefulness and perceived ease of use.
Perceived usefulness refers to the degree to which users perceive that use of technology
will improve his/her performance (Davis, 1989). Perceived ease of use refers to the degree
to which the users perceive that using the technology will be free of effort (Davis, 1989).
Given the theoretical soundness and wide empirical support TAM has received over the
years, current study employed TAM as base model and incorporated additional variable
into the framework of TAM developed in other theories.
2.2 Research gap in the Internet banking adoption research in India
Internet banking adoption is a well researched area for over three decades in developed
countries. Previous research has offered rich insights into understanding of the factors
determining the adoption of Internet banking services. Majority of these studies used TAM
as base model and investigated the influence of various factors on attitude and behavioral
intentions to adopt technology (Chang and Cheung, 2001; Wang et al., 2003; Guriting and
3
Ndubisi, 2006; Alsajjan and Dennis, 2010; Nor et al., 2010; Chong et al., 2010; Abbad, 2013;
Kesharwani and Tripathy, 2012; Giovanis et al., 2012; Kesharwani and Bisht, 2012; Lai and
Li, 2005; Cheng et al., 2006; Celik, 2008; Lee, 2009; Chiou and Shen, 2012; Pikkarainen et
al., 2004; Manzano et al., 2009; Eriksson et al.,2005; Suh and Han, 2002; Al-Sukkar,2005;
McKechnie et al., 2006; Jahangir and Begum, 2008; Chau and Ngai, 2010).
Previous studies, which were attempted to study technology adoption behavior
using TAM, often emphasized on adding social factors and individual characteristics into
the TAM framework. But these studies have given less importance to the technology
specific factors like website design and enjoyment in incorporating into the TAM. Very few
studies have added TAM with constructs of perceived risk theory and technology specific
factors like website design and enjoyment (Castaneda et al., 2007). Even fewer studies have
added and applied them in the field of Internet banking services (Celik, 2008).
Although, Internet banking adoption has been studied by many researchers in India
(Agarwal et al., 2009; Bhatt, 2011; Dash et al., 2011; Dash et al., 2012; Dixit and Datta 2010;
Kalaiarasi and Srividya 2012; Kesharwani and Bisht 2012; Kesharwani and Tripathy 2012;
Khare and Singh 2012; Khare et al., 2010; Khare et al., 2012; Kumra and Mittal 2004; Mann
and Sahni 2012; Safeena et al., 2010; Safeena et al., 2011; Sharma and Srikrishna 2014;
Varaprasad et al., 2013), the technology beliefs such as perceived website design and
perceived enjoyment, social factors like social influence and online environment specific
beliefs such as trust and risk have only been modelled and studied individually (Table I).
Absolutely there are no studies in Indian context which have attempted to examine the
effect of all these beliefs on adoption behavior, simultaneously, within the original
framework of TAM. For instance, Kumra and Mittal (2004) focused to examine importance
of trust in Internet banking and found that social bond, communication and opportunistic
behavior significantly influence consumer trust formation towards Internet banking use. In
a different study, Khare et al., (2010) investigated the influence of personality factors on
evaluation of online banking. Safeena et al., (2010) and Dash et al., (2012) focused on
investigating the effect of perceived risk, and found that perceived risk is the major
inhibiting factor in Internet banking adoption. Khare and Singh (2012) attempted to find
consumer concerns towards use of Internet banking and found that navigation through
website and risk are two major factors influencing Internet banking adoption.
<Insert Table I around here>
In an another study, Bhatt (2011) applied Theory of Planned Behavior to investigate

consumers’ beliefs towards Internet banking services and found that perceived behavioral
control, attitude and subjective norm are the determinants of intention. Applying an
extended version of TAM, Kesharwani and Tripathy (2012) found that self-efficacy and
perceived risk have significant effect on Internet banking acceptance behavior. Similarly,
Varaprasad et al., (2013) extended TAM by adding relative advantage, perceived risk and
conspicuousness constructs and found that PU, PEOU, perceived risk, relative advantage
and conspicuousness are the important determinants of Internet banking adoption. In
another study, Kesharwani and Bisht (2012) applied extended TAM and found that
perceived ease of use, perceived usefulness, perceived risk, and social influence have
significant positive influence on consumer behavioral intention to adopt Internet banking
4
services. Kalaiarasi and Srividya (2012) have applied IDT to examine the Internet banking
adoption and found that compatibility, trialability and complexity as the most significant
predictors of young consumers’ intention to use IBS. Building on TAM, Sharma and
Srikrishna (2014) added social influence, quality of Internet connection, awareness, and
self-efficacy constructs into their model. The results suggested that attitude determines
intention and attitude in turn is determined by perceived usefulness and perceived ease of
use. These two beliefs are further affected by social influence, awareness of banking
services, quality of Internet connections, and computer self-efficacy. Bashir and
Madhavaiah (2014) applied extended version of TAM on young students. The additional
variables included in the model are perceived risk, trust, self-efficacy and social influence.
The results suggest that perceived usefulness, ease of use, trust, self-efficacy and social
influence have significant positive effect on intention while as perceived risk found to have
significant negative effect on intention.
In summary, majority of these studies have concentrated on the importance of the

factors such as usefulness, ease, risk, security, relative advantage etc. But, very few have
studied other system characteristics such as website design (Kesharwani and Bisht, 2012;
Khare and Singh 2012), and none have studied perceived enjoyment. In Indian context, no
study has combined and applied TAM with perceived risk theory and technology specific
factors like website design and enjoyment to investigate attitude and intention towards use
of Internet banking services. Thus for the full understanding of Internet banking adoption
behavior, there is pressing need to study all these beliefs simultaneously. This paper
presents an integrated model to deepen understanding on Internet banking adoption
behavior by exploring online environment specific factors that influence acceptance and
use of Internet banking among Indian consumers.
2.3 Research model and hypotheses
The framework of this study is drawn based on two primary research streams, technology
acceptance theory and perceived risk theory. During past two decades, TAM has been
widely applied to examine technology usage and acceptance of e-services (Davis, 1993; Hsu
and Chiu, 2004; Hsu et al., 2006). However, TAM alone has not been able to provide
consistently superior explanations or behavioral predictions (Chen et al., 2007). Also, TAM
has been criticized for overlooking the influence of consumers’ perceptions regarding
adoption of technology (Gounaris and Koritos, 2008). Chuttur, (2009), criticized TAM as a
“theory” that has limited explanatory power and lack of practical value. To overcome these
limitations, a growing body of research has focused on extending TAM by including
additional variables borrowed from other theories and the results have showed that the
extended models had better explanatory power than the individual use of TAM (Suh and
Han, 2002; Wang et al., 2003; Lee, 2009; Celik, 2008; Chau and Ngai, 2010; Giovanis et al.,
2012; Chiou and Shen, 2012; Chong et al., 2010; Manzano et al., 2009; Abbad, 2013).
Moreover, Bashir et al., (2013), in their review of TAM studies in the context of Internet
banking, indicated that 19 out of 20 studies have incorporated additional variables into the
framework TAM in order to have better explanatory power.
The aim of this research is to determine consumer attitude and behavioral intention
towards adoption of Internet banking services, which is a complex and multifaceted
5
process intertwined with personal, social psychological, utilitarian and behavioral aspects.
Therefore, inclusion of additional variables should be comprehensive in order to examine
the consumers’ attitude and intention towards acceptance and use of Internet banking. The
proposed research model is presented in Figure I. Nine constructs are used in the model
which include behavioral intention, attitude, perceived usefulness, and perceived ease of
use from TAM and additional constructs perceived risk, trust, social influence, perceived
enjoyment and website design taken from perceived risk theory and technology adoption
literature. In accordance with TAM, the theoretical model proposed in this research
employs behavioral intention as dependent variable and attitude as mediating variable to
examine consumers’ Internet banking adoption behavior. The strength of the hypothesized
relationships and robustness of theoretical model is tested in predicting consumer
intention to use Internet banking services in Indian context.
<Insert Figure I around here>
Trust
There are many definitions of trust across research areas. Trust is defined, in the context of
Internet banking services, as the assured confidence a consumer has in the Internet
banking service provider’s ability to provide reliable services through Internet. Trusting
belief is which one believes that the other party has one or more characteristics beneficial
to oneself. Trusting intention means that one is willing to depend on, or intends to depend
on the other party even though one cannot control that party. In this study, trust is
operationalized as consumers’ confident belief in Internet banking service provided by
his/her bank.
In the relationship marketing literature, researchers have considered trust as a
critical factor for the success of relationships (Macintosh and Lockshin, 1997; Morgan and
Hunt, 1994). Trust plays an important role in the business-to-consumer (B2C)
relationships involving unknown risks (Gefen et al., 2003; Jarvenpaa et al., 1999). With the
advent of virtual marketplace, the role of trust has become more predominant and
attracted the attention of academicians and practitioners. With respect to online-shopping
and online-banking, potential uncertainties come from multiple sources such as
vulnerability of Internet, Internet communication platforms and the technical capability of
the vendors.
In Internet banking environment, consumers attach more importance to trust than
branch banking (Ratnasingham, 1998). This may be due to the absence of the physical
contact between the service employee and consumer in the service delivery process. Fears
of hackers and privacy invasion compound the uncertainty surrounding online services
(Hoffman et al., 1999; Yoon, 2002). Hence, the uncertainty and risk are inherent in online
banking environment. Research has shown that risk and trust are inseparable components
in decision-making (Morrison and Firmstone, 2000). Previous studies suggest that trust is
an antecedent of perceived risk (Manzano et al., 2009; Kesharwani and Bisht, 2012). In
environments such as Internet banking, trust is most effective strategic method to reduce
6
uncertainty and risk (Gefen, 2000; Hart and Saunders, 1997). In view of this, following
hypotheses are proposed:
H1a. Trust has a significant direct effect on consumers’ perceived risk to use IBS.
H1b. Trust has a significant direct effect on consumers’ attitude towards using IBS.
H1c Trust has a significant direct effect on consumers’ intention to use IBS.
Perceived website design
A significant limitation of the existing TAM models, in the context of Internet banking
adoption, is failure to recognize the features of the technology itself (Suh and Han, 2002).
The current research introduces the construct ‘perceived website design’ as potential
influential factor in Internet banking adoption. In this study, website design refers to the
layout, design, features and characteristics of the fully transactional web site of the bank.
According to Alhudaithy and Kitchen (2009), the Internet banking website of the
bank acts as a platform, where consumers constantly interact with the host-bank and can
perform a series of different banking activities without exerting much effort. Previous
studies (Jaruwachirathanakul and Fink, 2005; Kesharwani and Bisht, 2012) showed that
website features could facilitate the adoption of Internet banking. A user-friendly website
with security evidence displayed on it can enhance consumer confidence and reduce their
concerns about using the service.
Website characteristics are broadly classified into two categories: hedonic features;
those contributing to attractiveness, pleasure or fun and utilitarian features; that
contribute to usefulness or ease of use. Although, Ndubisi and Sinti (2006) observed that
both utilitarian and hedonic orientations of the Internet banking website contribute
significantly to adoption, Kuisma et al., (2007) found consumers attach more importance to
the utilitarian features than hedonic features.
Hence, website features such as easy navigation, display of security message, clarity
of instructions and reduced possibility for possible mistakes tend to enhance the
consumers intention to adopt Internet banking. Based on these view points, following
hypotheses are proposed for the study:
H2a. Well-designed website has a significant direct effect on consumers’ perceived risk in
using IBS.
H2b. Well-designed website has a significant direct effect on consumers’ perceived
usefulness in using IBS.
H2c. Well-designed website has a significant direct effect on consumers’ perceived ease of
using IBS.
Perceived enjoyment
Perceived enjoyment is defined as the extent to which the activity of using Internet banking
is perceived to be enjoyable in its own right (Davis et al., 1992). Celik (2008) and Moon and
Kim (2001) have incorporated perceived playfulness and (Igbaria et al., 1995) used
perceived fun in their respective studies, and for the current study, both of these constructs
7
are considered to be similar to the concept of perceived enjoyment. According to TRA, TPB,
and the general motivation theory, intrinsic and extrinsic motivators trigger specific
outcome behavior. The intrinsic motivators shape the perceptions of emotional threats
such as pleasure and satisfaction of using particular system, whereas extrinsic motivators
relate to the perceptions of tangible rewards such as task performance and goal
achievement (Vallerand, 1997). The framework of TAM treats PU as the extrinsic
motivator, and PEOU is partially treated as intrinsic motivator (Venkatesh and Davis,
2000). Celik (2008) posited that increasing the enjoyment of using a system would enhance
its acceptability. Therefore, enjoyment represents the intrinsic motivation to use the
system.
A number of studies in different technological settings have analyzed the effect of
perceived enjoyment on acceptance and use of technology (Teo et al., 1999; Moon and Kim,
2001; Igbaria et al., 1995; Lee, 2009). Most of these studies found that system usage and
the perceived fun were positively correlated with each other (Igbaria et al., 1994; Moon
and Kim, 2001; Teo et al., 1999). Moreover, Pikkarainen et al., (2004) and Abbad (2013)
extended TAM and indicated that enjoyment is significant determinant of Internet banking
acceptance and use. The findings of Abbad (2013) also indicated that enjoyment exert both
direct and indirect effects on intention to use Internet banking. It is asserted that higher
levels of enjoyment motivate users to spend more time on system, which in turn increases
users’ perception about system value (Moon and Kim, 2001; Venkatesh, 2000). Thus, if
users perceive that using Internet banking is enjoyable, it will cause willingness to spend
more time on Internet banking, which in turn may lead to develop positive beliefs about
usefulness and ease of use. Therefore, as a result of above discussion, perceived enjoyment
is included as intrinsic motivator in this study and is expected to influence attitude,
perceived usefulness and perceived ease of use. Following hypotheses are propounded:
H3a. Perceived enjoyment has a significant direct effect on consumers’ perceived usefulness
in using IBS.
H3b. Perceived enjoyment has a significant direct effect on consumers’ perceived ease of
using IBS.
H3c. Perceived enjoyment has a significant direct effect on consumers’ attitudes towards
the use of IBS. (New relation added during SEM)
H3d. Perceived enjoyment has a significant direct effect on consumers’ intention to use IBS.
(New relation added during SEM)
Social influence
Social influence is defined as ‘the persons’ perception that most people such as friends,
family, colleagues, peers and social group, who are important to him think he should or
should not use the Internet banking services’. The importance of social influence in
consumer behavior is well documented. In TRA, Fishbein and Ajzen (1975) first introduced
the term “subjective norm” to describe social influence. Later social influence was
employed as a construct in UTAUT by Venkatesh et al., (2003). The importance of social
influence on technology acceptance behavior is widely acknowledged (Kesharwani and
Tripathy, 2012). In recent years, researchers have incorporated social influence into the
8
framework of TAM. Past research presents mixed results that show direct impact of social
influence on behavioral intention. TRA posits that social influence has a direct influence on
behavioral intention (Fishbein and Ajzen, 1975). This argument was supported by finding
of Venkatesh and Davis (2000) and Yi et al., (2005), who also found that social influence
exerts significant effect on perceived usefulness. In contrary, Mathieson (1991), Lewis et
al., (2003) and Shih and Fang (2004) did not find any significant impact of social influence
on behavioral intention.
During recent past, IB researchers integrated social influence into the framework of
TAM and found that social influence affects behavioral intention, as well as perceived
usefulness (Abaad, 2013; Kesharwani and Tripathy, 2012). Furthermore, Martins et al.
(2014) employed unified theory of acceptance and use of technology (UTAUT) to predict
determinants of Internet banking adoption. The results confirmed that social influence is
strong predictor of behavioral intention. Although, study of Abbasi et al. (2011) confirmed
positive effect of social influence on consumers’ intention to use IB, however, their results
showed no significant relationship between social influence and perceived usefulness. They
found a significant relationship between social influence and perceived ease of use.
Therefore, in order to clarify the effect of social influence on various dependent variables,
following hypotheses are proposed:
H4b. Social influence has a significant direct effect on consumers’ perceived usefulness to
use IBS.
H4a. Social influence has a significant direct effect on consumers’ perceived risk to use IBS.
H4c. Social influence has a significant direct effect on consumers’ perceived ease of using
IBS.
H4d. Social influence has a significant positive direct effect on consumer’ intention to use
IBS.
Perceived risk
Perceived risk is defined as the uncertainty that a consumer may incur financial,
performance, social and/or privacy loss, when they cannot foresee the consequences of
using Internet banking services. In consumer behavior literature, perceived risk is well
documented as a critical factor to the consumer in any financial transaction (Bettman,
1973). Consumers tend to consider all uncertainties and possible adverse outcomes when
they make their product/service decisions (Mitchell, 1999). In online environment, where
negative outcomes are likely or when the uncertainty is high, the consumers’ perception of
risk increases. In other words, consumers’ purchase decisions are significantly influenced
by perceived risk, particularly in the situations where the probability of unpredictable,
unpleasant and negative consequences is connected to those decisions.
Perceived risk is an important factor for consumer resistance in various technology
adoption instances, specifically ones which involve financial transactions, such as online
shopping (Vatanasombut et al., 2004) and Internet banking (Celik, 2008; Lee, 2009). This is
because the Internet is an inherently risky environment and consumers perform their
transactions with no face-to-face contact with the supplier’s personnel, and lack of
9
transaction security and privacy protection (Featherman and Pavlou, 2002; Jarvenpaa et
al., 2000).
In recent years, Internet banking researchers incorporated perceived risk as a
construct in the TAM to overcome its lack of task environment focus and to enhance
behavior predictability. Extant research provide evidence that perceived risk has negative
influence on consumers’ attitude and behavioral intention to adopt Internet banking (Celik,
2008; Chiou and Shen, 2012; Kesharwani and Tripathy, 2012; Lee, 2009). Furthermore,
past studies found that perceived risk negatively affects perceived usefulness of using
Internet banking (Cheng et al., 2006; Lee, 2009). The findings of these studies conclude that
perceived risk negatively affects consumers’ attitude towards and intentions to adopt
Internet banking services. Thus, the following hypotheses are proposed to be tested:
H5a. Perceived risk has a significant negative direct effect on consumer’s attitudes towards
the use of IBS.

H5b. Perceived risk has a significant negative direct effect on consumers’ intention to use
IBS.
H5c. Perceived risk has a significant negative direct effect on consumers’ perceived
usefulness of using IBS.
Perceived usefulness
Within the framework of TAM, perceived usefulness is a significant factor affecting

acceptance of information systems (Davis, 1989; Davis et al., 1989). Perceived usefulness is
defined as “the extent to which a consumer believes that using Internet banking services
would enhance his or her banking performance”. Many information systems researchers
have empirically validated the positive influence of perceived usefulness on attitude and
intention of using information systems as postulated in TAM (Davis, 1989; Venkatesh and
Davis, 2000; Venkatesh, 2000). Moreover, previous Internet banking studies have provided
empirical evidence for significant positive effect of perceived usefulness on both attitude
and intention (Celik, 2008; Chau and Ngai, 2010; Cheng et al., 2006; Chiou and Shen, 2012;
Lee, 2009). Also, the findings of these studies have confirmed that perceived usefulness
mediates the influence of external variables on attitude and intention.
Therefore, consumers are more likely to adopt Internet banking if they perceive it to
be more useful than branch banking. Hence, based on these reviews, following hypotheses
are proposed:
H6a. Perceived usefulness will have a significant positive direct effect on consumers’
attitude to use IBS.
H6b. Perceived usefulness will have a significant positive direct effect on consumers’
behavioral intention to use IBS.
Perceived ease of use
Perceived ease of use (PEOU) is defined as the degree to which a consumer believes that
using Internet banking services would be effortless to use (Davis, 1989). TAM posits
10
perceived ease of use as a major belief that influences and mediates the influence of other
variables on attitude and intention to use information systems (Davis, 1989). Many studies
have empirically established that PEOU influences individuals’ attitude and intention
towards use of an information system (Davis et al., 1989; Venkatesh, 2000). Similar results
have been confirmed by various studies in the context of Internet banking acceptance
(Celik, 2008; Chau and Ngai, 2010; Chiou and Shen, 2012; Giovanis et al., 2012; Lee 2009).
In addition, some studies have found that PEOU exerts its effect on attitude and intention
through PU (Abaad, 2013; Celik 2008; Kesharwani and Tripathy, 2012; Lee, 2009).
Consumers can perceive ease of using Internet banking, if it is user-friendly, easy to
operate and remember and does not involve too much hassle to operate. The easier to use
the technology, more useful it is perceived to be and more likely to be accepted by users.
Therefore, following hypotheses are proposed:
H7a. Perceived ease of use will have a significant positive direct effect on perceived
usefulness to use IBS.
H7b. Perceived ease of use will have a significant positive direct effect on consumers’
attitude to use IBS.
H7c. Perceived ease of use will have a significant positive direct effect on consumers’
behavioral intention to use IBS.
Attitude towards use of IBS
Attitude is defined as “learned predisposition to respond in a consistently favorable or

unfavorable manner with respect to a given object” (Fishbein and Ajzen, 1975). In the
present study, attitude is defined as an individual’s positive or negative feeling towards use
of Internet banking services. Fishbein and Ajzen (1975) first introduced the attitude in TRA
and later Davis (1989) employed attitude as a construct in TAM and advanced that attitude
affects individual intention. Apart from the personal, social, psychological, and utilitarian
aspects that constantly interact and shape the outcome of an individual’s behavior, the
behavioral aspects such as perceptions, attitudes and beliefs about attributes of Internet
banking play critical role in the adoption or rejection of usage of technology. In the context
of Internet banking adoption, attitude becomes more prevalent, as IBS directly involves
monetary transactions and hence underlying consumer beliefs about risk and safety shape
the attitude of the consumers. Moreover, attitude is considered as a social function
(Nunnally and Bernstein, 1994). It is contagious in which people influence each other’s
attitudes by affirming or contradicting them through interactions and mutual experiences.
Previous studies (Lai and Li, 2005; Cheng et al., 2006; Suh and Han, 2002; Lee, 2009;
Chiou and Shen, 2012) provide empirical evidence that consumers’ attitude influences their
intentions to use Internet banking services. Likewise, many studies which employed
attitude as mediating variable, indicated that attitude mediate the impact of PU and PEOU
on consumers’ intention to use Internet banking services. Based on these empirical findings
this study advances following hypothesis:
H8. Attitude has a significant positive direct effect on consumers’ behavioral intention to
use IBS.
11
3. Research methodology
3.1 Questionnaire design
A structured questionnaire, consisting of three parts, is developed for the purpose of

collecting primary data from the Internet banking users in India. The first part of the
questionnaire is intended to collect the data related to demographic characteristics of the
respondents, viz., gender, age, occupation, education, marital status, income and area of
residence. Second part of the questionnaire seeks to cover respondents’ bank account and
transaction experience related information. The third part of the questionnaire is aimed to
measure the various constructs related to Internet banking adoption for establishing the
relationships among them.
The measurement instrument, of the second part of the questionnaire, was

developed based on the review of existing literature on technology adoption models and
their extensions in the context of adoption of various technologies in general and Internet
banking technology in particular. List of 42 items under 9 constructs are incorporated in
the conceptual model viz., trust, perceived website design, perceived enjoyment, social
influence, perceived risk, usefulness, ease of use, attitude and behavioral intentions.
Changes are made in wording of items to suit to Indian context. The construct perceived
usefulness, having six items, is adapted from Giovanis et al., (2012); Nor et al., (2010);
Cheng et al., (2006) and Manzano et al., (2009). All five items of perceived ease of use are
based on the research of Cheng et al., (2006); Nor et al., (2010); Giovanis et al., (2012) and
Manzano et al., (2009). For measuring perceived enjoyment, all the three items are adapted
from Venkatesh and Bala (2008) and Pikkarainen et al., (2004). The six items of perceived
risk are based on the works of Zhao et al., (2008); Manzano et al., (2009) and Grabner-
Krauter and Faullant (2008). For measuring social influence, all the three are adapted from
Lee (2009). The five items of the construct, trust are adapted from the studies of Suh and
Han (2002) and Nor et al., (2010). All the four items of website design are based on the
research of Cyr et al., (2008) which was conducted in Indian context. For measuring
consumer attitude, all the five items are adapted from Cheng et al., (2006); Suhand Han
(2002); Shih and Fang (2004), and Grabner-Kräuter and Faullant (2008). Finally, for
measuring behavioral intentions of Internet banking users, all the five items are taken from
Suh and Han (2002); Walker and Johnson (2006); Shih and Fang (2004), and Al-Sukkar
(2005). All the items are measured on a Likert-type scale with anchors ranging from “1”
(strongly agree) to “5” (strongly disagree). The face validity of the questionnaire was tested
with the help of a group of six experts and some changes are incorporated based on their
suggestions.
A pilot study is conducted to test the items of the instrument on a sample of 40
respondents before starting the main data collection process, in order to determine the
time taken to complete it and to have complete understanding of the difficulties of
respondents in completing it. Results from this pilot study lead to minor changes to the
questionnaire in working and rephrasing to suit to the Indian context.
3.2 Data collection

12
The present study is aimed to analyze the behavioral intentions of the users of Internet
banking services, in order to explore the potential barriers to the adoption of Internet
banking services in a developing country like India by using nine different constructs.
Hence, the population considered for the study is active Indian Internet banking users aged
18 years and above, who are having atleast one bank account and are sampled randomly.
The primary data are collected, using structured questionnaire, from 697 respondents.
In order to have the representative sample of Indian Internet banking users for data
collection, an online survey is employed. Online survey is considered to be suitable for the
current study because it is the best method to collect primary data pertaining to Internet
banking users spreading across the country and is economical and quick way of collecting
data. The questionnaire is created in the Google-docs and posted on various
groups/pages/circles/forums of online-media to collect data from Indian Internet banking
users. The process of data collection is random, the web-link of the questionnaire is posted
randomly on various groups/pages/circles/forums and participants are free to participate
at their own discretion. No monetary or any other incentives are offered to the
respondents, survey displayed a massage to participate in the survey aimed purely for
academic purpose. To reduce the possibility of a respondent participating in the survey
more than once, each respondent is required to provide his/her name and e-mail address
in the survey.
Later, duplicate names and e-mail addresses are used to filter out multiple
responses from the same respondent. The survey is run for two months and when the
response rate dropped significantly, survey is stopped by switching from option “accepting
responses” to the option “not accepting responses” provided in the Google-docs, so that no
further responses are recorded. The online survey resulted in recording 780 responses
directly into the data file. After, deleting incomplete forms, using list-delete method, 697
responses are declared to be fit for further analysis. The summary of demographic profile
of respondents is presented in Table II. The sample constituted around sixty eight per cent
males and 31.9 per cent females. The ratio of male to female respondents is 2.13:1. Majority
of the respondents are unmarried (63.70 per cent). With respect to age, 56.1 respondents
are in the 26-35 age-group, 30.1 per cent are in the 18-25 age-group, and age-group of 36-
45 category comprised of 9.8 per cent. This pattern shows that the young adults (18-35
years) consumers constitute the majority (86.2 per cent) of Indian Internet banking users’
sample.
In order to check non-response bias, non-parametric tests like Mann-Whitney U test
and Wilcoxon Matched Pair Signed Rank test are performed and the results indicate that
there is no significant difference between first and last quartile of respondents. Further,
post hoc Harmon’s single-factor test is conducted to check common method bias (Podsakoff
et al., 2003). The results show that there is no substantial amount of common method bias
in the data.
<Insert Table II around here>
3.3 Data analysis tools

13
Software Package for Social Sciences (SPSS Version 20.0) and Analysis Moment of
Structures (AMOS Version 20.0) are used for data analysis. Since some scale items are
adapted to the specific context of the research, an exploratory factor analysis (EFA) is first
conducted, followed by a two stage structural equation modeling (SEM) recommended by
Anderson and Gerbing (1988) and Hair et al., (2013) to analyze the data. The EFA is
conducted by using principal component analysis with varimax rotation for factor
extraction and to test sampling adequacy. This is followed by conducting two stage
structural equation modeling. In the first stage, measurement model is validated and
association among study latent and observed variables is examined using confirmatory
factor analysis (CFA). In the second stage, structural model is examined to investigate the
extent and direction of relationship among the latent variables. In addition bootstrapping is
conducted to investigate direct and indirect effects of independent variables on dependent
variables.
4. Data analysis and results
4.1 Exploratory factor analysis
Before performing structural equation modelling, an exploratory factor analysis (EFA) is

conducted on 42 items to test sampling adequacy and to identify underlying factors. The
results show that Bartlett’s test of Sphericity is significant (p < 0.001) and Kaiser-Meyer-
Oklin’s (KMO) estimate is 0.945, which exceeds the recommended minimum value of 0.6
for sample adequacy (Tabachnick and Fidell, 2013). The rotated factor matrix, resulting
from a Varimax rotated principal axis factor extraction of the independent variables using
the 1.0 Eigen value cut-off criterion, indicates extraction of nine factors explaining 66 per
cent of the variance. Each item is evaluated individually and all factor loadings are greater
than 0.5.
4.2 Analysis of measurement model
In the first stage of SEM, confirmatory factor analysis (CFA), using AMOS 20.0, is conducted
to test the validity of the measurement model. The initial measurement model met the
criteria of Bollen (1998), wherein each latent variable has at least two indicators and each
observed variable is determined by one latent variable. The latent variables are allowed to
correlate and measurement errors are uncorrelated. The results of initial measurement,
presented in Table III indicate a poor model fit. The Chi-square/degree of freedom is
greater than 3.0 acceptable value; goodness-of-fit index (GFI=0.815), adjusted goodness-of-
fit index (AGFI=0.802), normalized fit index (NFI=0.847), and comparative fit index
(CFI=0.890) are also below the 0.90 acceptable levels. In addition, root mean square error
of approximation (RMSEA= 0.068) is greater than 0.05 acceptable limit.
<Insert Table III around here>
14
Thus, in order to improve model fit and achieve adequate discriminant and
convergent validity, a detailed evaluation of measurement items is conducted to refine and
re-specify the model. The measurement model is revised by examining factor loadings,
standard residuals, and modification indices of all items as suggested by Byrne (2010),
Kline (2011), and Hair et al. (2013). The AMOS output indicates that seven items (PU6,
PEOU1, PR4, PR6, TRT3, PWD1 and BI3) had factor loadings less than acceptable limit of
0.7, standard residual values are not within the acceptable cut-off limit of ±2.58, and/or are
indicated to be cross loaded with multiple latent factors. Each of these items is deleted one
at a time and the model is consequently re-examined. The sequence of item deletion began
with item showing cross loading with multiple factors with residual values above +2.58 or
below –2.58, and the one that would result in the highest decrease in Chi-square estimate.
Thus, in the process of model refinement, seven measurement items (PU6, PEOU1, PR4,
PR6, TRT3, PWD1 and BI3) are deleted from the original 42 items and the CFA is re-run.
The results of revised measurement model containing 35 items show that standard
regression weight of all measurement items exceeds the 0.7 criteria. Also, the values of
standard residuals are within the threshold level (+2.58, –2.58), critical ratio values are
above 1.96 and no modification indices, greater than 20, are observed. The results of
measurement statistics substantially improved from the initial model and the revised
model demonstrated a better fit to the data. As shown in Table III, the goodness-of-fit
statistics of revised model shows an acceptable fit. The Chi-square/degree of freedom
(1.884) is less than 3.0. GFI, AGFI, NFI, CFI are all above acceptable cut-off of 0.9. RMSEA
(0.036) is less than 0.05. Thus, goodness-of-fit statistics confirms that the revised
measurement model shows adequate fit with the data, indicating no further modification in
the model is required. Therefore, the unidmensionality of the model is established (Byrne,
2010; Hair et al., 2013).
4.3 Reliability and validity of the measurement instrument
The construct’ reliability is evaluated by two indicators: Cronbach’s alpha (CA) and
composite reliability (CR). As shown in the Table IV, CA and CR values for each construct
are well above the threshold limit of 0.7 (Nunnally and Bernstein, 1994; Hair et al., 2013),
indicating that each construct shows adequate internal consistency.
The convergent validity is assessed by examining standardized factor loadings,
average variance extracted (AVE), maximum shared variance (MSV) and average shared
variance (ASV) and composite reliability (CR) suggested by Hair et al. (2013). As a general
rule of thumb, standardized factor loadings greater than 0.70, CR value more than 0.70 and
AVE more than 0.50 demonstrates adequate convergence (Hair et al., 2013). The results of
convergent validity are presented in Table IV. The standardized factor loadings of all
observed variables are well above the minimum cut-off limit of 0.7 with highest value of
0.949 and lowest value of 0.706. AVE, ranging from 0.627 to 0.856 is greater than minimum
cut-off limit of 0.5. Composite reliabilities of constructs exceeded 0.7 limit ranging from
0.830 to 0.948. In addition, maximum shared variance (MSV) and average shared variance
(ASV) for all constructs is less than their respective AVE. Therefore, all conditions for the
convergent validity are met.
15
To demonstrate discriminant validity, the AVE should be greater than the squared
correlations between the constructs (Fornell and Larcker, 1981). As shown in Table V, the
value of AVE is greater than squared correlations for all constructs. Hence, discriminant
validity is demonstrated.
<Insert Table IV around here>
<Insert Table V around here>
4.4 Analysis of structural model
In the second stage of structural equation modeling, path analysis is conducted to test the
hypothesized causal relationships. The model fit statistics of the proposed structural model
(see Figure I) indicates a poor structural model fit. As per the guidelines of Byrne (2010)
and Kline (2011), model is re-specified based on modification indices. Based on
modification indices, two direct paths from perceived enjoyment (PENJ) to attitude (ATT)
and to behavioral intention (BI) are added. In the proposed research model, no direct
relationship between perceived enjoyment and attitude (PENJ→ ATT); and perceived
enjoyment and behavioral intention (PENJ→ BI) is hypothesized. The revised structural
model is again tested and the adequacy of the structural model in terms of its ability to
reflect variance and covariance of the data is assessed using Chi-square statistics. Other fit
indices such as GFI, AGFI, CFI, NFI, and RMSEA are considered along with Chi-square. All
the goodness-of-fit statistics (Chi-square/df=1.92, GFI=0.937, AGFI=0.920, NFI=0.961,
CFI=0.979 and RMSEA=0.036) are in the acceptable ranges. Generally, fit statistics greater
than or equal to 0.9 for GFI, AGFI, NFI, and CFI indicate a good model fit (Hair et al., 2013).
Furthermore, RMSEA values ranging from 0.05 to 0.08 are acceptable (Hair et al., 2013).
Thus, all fit indices suggest that the model fit is acceptable.
4.4 Hypothesis testing
The path analysis is conducted to test the proposed causal relationship among the various
variables. In Table VI, the results of hypothesis testing, unstandardized regression
estimate, standardized path coefficient, critical ratio, and significance level observed for
each hypothesized path is shown. The results reveal that consumers’ behavioral intention
to use Internet banking is jointly predicted by attitude (β=0.55, standardized path
coefficient, p< 0.001), perceived enjoyment (β=0.11, p< 0.01), perceived risk (β = -0.02, p<
0.01), trust (β = 0.13, p< 0.001), and social influence (β = 0.08, p< 0.001). Together these
variables explained 66 per cent of the variance of behavioral intention to use IBS (R2=0.66,
coefficient of determination). Therefore, hypotheses, H8, H3d, H5b, H1c, and H4d are all
supported. On the other hand, perceived usefulness (β = 0.01, p >0.05), and perceived ease
of use (β = 0.06, p >0.05) show no significant direct effect on consumers’ behavioral
intention to use IBS. Hence, hypotheses H6b and H7c are both rejected.
<Insert Table VI around here>
16
Attitude is predicted by perceived usefulness (β = 0.22, p < 0.001), perceived ease
of use (β = 0.16, p < 0.001), perceived enjoyment (β = 0.09, p < 0.01), and trust (β = 0.30, p
<0.001). Together these variables explained 59 per cent of the total variance in attitude.
These findings validated hypotheses H6a, H7a, H3c, and H1b respectively. Perceived risk (β
= 0.01, p >0.05) has not exerted any significant direct effect on attitude. As a result,
hypothesis H5a is not supported. As seen in the Figure II and Table VI, both perceived
ease of use (β = 0.70, p < 0.001) and perceived enjoyment (β = 0.14, p < 0.001) significantly
influence PU and jointly explains 68 per cent of the total variance in PU. Therefore, the
hypotheses H7a and H3a are validated. Results further indicate that perceived risk (β = -
0.02, p >0.05), perceived website design (β = 0.02, p >0.05), and social influence (β = 0.01, p
>0.05) have no significant effect on perceived usefulness. Hence, hypotheses H5c, H2b, and
H4b are rejected. Perceived ease of use is significantly influenced by perceived website
design (β = 0.26, p < 0.001) and perceived enjoyment (β = 0.54, p < 0.001) both explained
57 per cent of the total variance in PEOU. As a result, hypotheses H3c and H3b are
supported. However, social influence (β = -0.06, p >0.05) has not exerted any statistically
significant effect on PEOU. Therefore, hypothesis H4c is not supported.
Trust (β = -0.50, p < 0.001) and social influence (β = -0.14, p < 0.001) both have a
significant negative effect on perceived risk of using Internet banking and jointly explained
23 per cent of the total variance in perceived risk. Hence, hypotheses H1a and H4a are
validated. However, results indicate that perceived website design (β = 0.03, p >0.05) has
no significant effect on perceived risk. Therefore, hypothesis H2a is not supported. The
hypotheses results are shown in Table VI. In order to further assess the significance of
indirect effects of predictor variables on PU, ATT and BI, bootstrapping method is
employed with 500 resamples (Baron and Kenny, 1986; Preacher and Hayes, 2004). Table
VII reports the results of direct, indirect and total effects of predictor variables on PU, ATT
and BI. The results of bootstrapping indicate that PU (β = 0.124, p <0.01) and PEOU (β =
0.185 p <0.01) exert significant indirect effect on behavioral intention to use IB. It indicates
that attitude mediates the effects of PU and PEOU on behavioral intention. In addition,
results indicate that perceived website design which had no significant direct effect on
intention, exert significant indirect effect (β = 0.126, p <0.05) on intention. The final revised
structural model showing both significant paths (thick lines) and non-significant paths
(dotted lines) is presented in Figure II.
<Insert Figure II around here>
<Insert Table VII around here>
5. Discussion
The objective of this paper is to study consumers’ perception, attitude and behavioral
intention to use IBS. The results of this study provide empirical support for the proposed
research model shown in Figure I. Most of the causal relationships between the variables
in the study are supported. The overall explanatory power of modified structural model
had an R-square of 66 per cent for intention to use IBS, and an R-square of 59 per cent for
17
attitude towards IBS. Also, the TAM beliefs, perceived usefulness and perceived ease of use
has an R-square of 68 per cent and 57 per cent respectively, suggesting that these two
beliefs act as strong mediators in exerting the effect of predictor variables on attitude.
Overall, results suggest that proposed model of this study is capable of explaining a
significantly good proportion of variation of attitude and intention to use IBS.
Attitude has a strong impact (β = 0.55) and appears to be the primary positive
determinant of consumers’ intention to use IBS, followed by perceived website design (β =
0.16), trust (β = 0.13), perceived enjoyment (β = 0.16), and social influence (β = 0.10). It
implies that the attitude is the most important predictor of the consumers’ intention to use
IBS, which is in consistent with many previous studies (Lai and Li, 2005; Cheng et al., 2006;
Suh and Han, 2002). Though perceived risk (β = 0.03) exercised the negative effect on
intention to use IBS, the magnitude of the effect is small. This finding is similar to the
finding reported in Featherman and Pavlou (2002), which indicates that the effect of
perceived risk on intention is almost insignificant. This situation can be possibly explained
by the indirect effect of PEOU on intention, which inhibits PR’s negative influence on
behavioral intention. In this study, PEOU may possibly reduce the consumers’ negative risk
perceptions by indirectly influencing intention. Also, in this study PR has not exerted any
significant effect on TAM beliefs (PU and PEOU).
Though perceived usefulness (β = 0.22) and perceived ease of use (β = 0.17) exerted
a positive effect on attitude, both had no significant direct effect on intention to use
Internet banking. Similar findings are obtained by Chiou and Shen (2012) and McKechnie et
al. (2006). These results can be explained by the mediating role of attitude in the research
framework, which reflects that in the presence of attitude, both PU and PEOU has no
significant direct effects on behavioral intention. The effect of PU and PEOU is thus fully
mediated via attitude (see Table VII).
Furthermore, in accordance with TAM, the results of this study suggest that
perceived ease of use (β = 0.70) has strong positive effect on perceived usefulness,
suggesting that PU mediates the influence of perceived ease of use on attitude. This finding
is also supported by the results of previous Internet banking research by Chiou and Shen
(2012) and Suh and Han (2002), who investigated Internet banking adoption in Taiwan
and Korea respectively. Therefore, it can be interpreted that perceived usefulness is more
influential in shaping consumers’ attitude towards using Internet banking services than
perceived ease of use, and PEOU exerts its effect on attitude through PU.
An interesting outcome of this research is that the effect of perceived usefulness and
perceived ease of use on intention is fully mediated by attitude. As shown in the Table VII,
PU (β = 0.12) and PEOU (β = 0.18) have significant indirect effect on intention but have no
statistically significant direct effect on intention. On the other hand, both PU and PEOU
have significant direct effect on attitude. Also, the direct effect of trust (β = 0.13) on
intention is relatively lesser in strength than its indirect effect (β = 0.20) on intention via
attitude, confirming that attitude acts as a strong mediating variable within the framework
of TAM. Furthermore, attitude also has a significant impact (β = 0.553) on intention and
appears to be the first positive determinant of consumers’ intention to use Internet
banking. Thus, unlike previous studies which advocated that the inclusion of attitude into
TAM framework is not meaningful (Davis et al., 1989), the results of this study suggests
that attitude acts as mediating variable and exerts a strong positive effect on intention to
18
use IBS. This result is similar to the finding reported by Lee (2009). Therefore, it implies
that a bank should promote its Internet banking services by communicating usefulness,
user-friendliness and other benefits of IBS to consumers so that they develop positive
attitudes towards using Internet banking.
Another interesting finding of this study is that consumers’ trust in IB shows a
significant negative effect (β = -0.504) on perceived risk, indicating that trust reduces the
consumers’ risk perception towards the use of Internet banking. This result is similar to the
finding reported in Kesharwani and Bisht (2012), which indicated that trust is significant
antecedent of perceived risk. Thus, it implies that positioning Internet banking as a secured
and trustworthy channel of distribution can instill trust among consumers to transact
online. Developing an effective communication strategy to enhance consumer trust in
Internet banking, can go long way to reduce consumers’ risk perceptions.
Furthermore, this study found that website features (β = 0.256) have a significant
positive impact on perceived ease of use. This result is similar to the findings reported in
Kesharwani and Bisht (2012), which indicated that well-designed IB web sites would
increase perceived ease of use and create stickiness with IBS. The results of the present
study also indicate that website design has not exercised any significant effect on PU and
PR. One possible reason for this may be that the presentment of IB websites in India is still
in its nascent stage, and consumers could not relate risk and usefulness of using Internet
banking with the website design.
The results also revealed that perceived enjoyment is the second major determinant
of PU with a total effect of 0.52, mainly due to indirect effect (β = 0.38) and partially due to
direct effect (β = 0.14) as shown in Table VII. In addition, perceived enjoyment has strong
direct influence (β = 0.54) on PEOU, suggesting that PEOU mediates the indirect effect of
perceived enjoyment on usefulness. The direct influence of enjoyment on PEOU is in
consistent with the results of Celik (2008) which suggest that the higher levels of
enjoyment intensify consumers’ intrinsic motivation, which in turn lead consumers to
perceive system usage as effortless. On the other hand, the finding of this study about the
significant direct influence of enjoyment on PU contrasts with findings of Celik, (2008). One
possible reason for this contradiction may be that the higher levels of enjoyment improve
the perception of system efficiency and increase the perceived value of system which is in
consistent with findings of Barua, et al., (1996).
Another interesting finding of this research is that social influence has a significant
negative effect (β= -0.136) on perceived risk, which is in consistent with the findings of
Kesharwani and Bisht (2012). However, it is also found that social influence has no
significant effect on PU and PEOU. Similar results are reported by Abbad (2013), which
indicated that subjective norm has no significant effect on PU. This may be because of the
reason that they find it easy to use and useful for the solution of a problem, or because it is
demanded by their own value and not by their social values.
The results of this research conclude that the consumers crystallize their
perceptions about IB in terms of its usefulness, website features, ease, enjoyment, trust and
risk involved. These perceptions directly and indirectly influence their intention to use
Internet banking through attitude.
6. Research contribution
19
This study has significant contribution to research on online consumer behavior. The
contribution of this study is three fold: theoretical, methodological and managerial
contributions, which are discussed below:
6.1 Theoretical contribution
In terms of theory building, this study suggests a new direction for technology acceptance
research by considering the characteristics of the Internet banking environment by
presenting an integrated model of the determinants of Internet banking adoption and use.
The model develops a new theory by building new variables in an integration of technology
acceptance model (TAM) and theory of planned behavior (TPB); and applying them to a
new context. It is worthy to note that the new variables specific to online environment,
included in this research, viz., trust, risk, enjoyment and website design are compatible
with the TAM and TPB variables. Whilst, conventional consumer behavior is well
documented by economic and marketing theories, research has supported the importance
of technology-related variables at par with traditional variables in predicting online
consumer behavior (Jarvenpaa et al., 1999; McKnight et al., 1998; Pavlou, 2003). The
findings of this study suggest that it is crucial for consumer behavior researchers to
examine the role of uncertainty in situations in which trust and perceived risk are likely to
affect system use. Thus, current approach adds richness and insights to the understanding
of individual reactions to the adoption and use of self-service banking channels. Also, the
proposed model makes important contribution to the emerging literature on e-commerce,
especially with regard to Internet banking.
Although, TAM is believed to be parsimonious and robust model, previous research
works on TAM have studied acceptance of technology as the product of a rational process
emphasizing on expected operational outcomes. TAM only employs two core beliefs-
perceived usefulness and perceived ease of use, to explain behavioral intention. However,
consumers’ intention will also be affected by other factor such as social influence (Fishbein
and Ajzen, 1975). Furthermore, even if consumers intend to exhibit a behavior, they may
not be able to do so due to lack of skills, resources and confidence in their self-efficacy
(Ajzen, 1991). Although, TPB demonstrates the roles of individuals, organizational
members and societal members on behavioral intention, it is silent in explaining the beliefs
that affect users’ attitude and intention to perform the behavior. This limitation of TPB is
overcome by attitudinal beliefs of TAM (PU and PEOU) and these two theories are
complementary approaches. However, there is dearth of research which focuses on how
these beliefs of usefulness and ease of use are formed and what constitutes these
beliefs. Thus, by including constructs such as trust, perceived risk, perceived enjoyment,
website design and social influence into the framework of TAM, this study advances the
understanding on the role of these two TAM beliefs in forming perceptions, affecting
attitudes and intention towards the use of technology. And also, present study contributes
to the TAM literature by investigating the effects of external variables on TAM core beliefs,
viz., PU and PEOU. The results of this study highlight how PU and PEOU are formed, and
20
how they influence the acceptance of new information system such as Internet banking.
Moreover, the empirical results show that the integration of TAM and TPB with additional
variables has good explanatory power, and this may provide a basis for the integration of
other technology acceptance models. Thus, it is anticipated that the framework of this
study may encourage technology researchers to integrate other competing models such as
innovation diffusion theory (IDT), social cognitive theory (SCT), and theory of reasoned
action (TRA), each with different sets of acceptance determinants to develop unified model
with better explanatory power.
The TAM literature is divided into two streams of research. The first stream of
research advocates that influence of attitude on system usage is wiped out by perceived
usefulness and perceived ease of use which are considered to predict intention to adopt
information system (Davis et al., 1989; Venkatesh and Bala, 2008; Venkatesh and Davis,
2000). The researchers advocating this school of thought exclude attitude construct from
the TAM framework arguing that attitude offers little value in predicting information
system use. The second stream of research argues that attitude plays an important role in
the acceptance and use of technology and hence they retain attitude in the framework of
TAM. The current research included attitude in the TAM framework and the results
revealed that attitude is the major determinant of consumers’ intention towards use of
Internet banking. Moreover, it is found that attitude mediates the effect of PU and PEOU on
intention, thus contributing to the existing literature which advocates importance of
attitude in explaining individual technology acceptance.
6.2 Methodological contribution
From methodological perspective, this study offers unique contribution in terms of data
collection and data analysis methods. Firstly, the current study employed an online-survey
approach to collect primary data. Existing studies have relied on traditional method of
collecting data, which normally limits the generalizability of the research. But, this study
suggests that online-survey approach enhances speed, provides versatility, and is cost-
effective way to have large number of cases for analysis. Moreover, the current study
employed Structural Equation Modelling (SEM) approach using AMOS (Version 20.0)
respectively, to validate measurements and test the causal relationships. Thus, use of
online survey for collecting primary data and application of sophisticated statistical tools
signify an advanced research design and this approach sets a new pattern in online
consumer behavior research.
6.3 Managerial contribution
The results of this study revealed that if consumers’ beliefs about trust, usefulness,
enjoyment, and features of IB are appropriately managed, their willingness to adopt
Internet banking will increase. Attitudinal beliefs play a major role in influencing
consumers’ intention to use IB. Therefore, banks can focus more on cultivation of positive
attitudinal beliefs about Internet banking among prospective consumers. This study has
confirmed that trust is one of the most critical factors of Internet banking acceptance and
trust has more direct influence on perceived risk than on perceived ease of use. Therefore,
21
banks can pay more attention to trust-building strategies. In order to earn trust, banks can
implement Keep-Consumer-Informed (KCI) strategy. For instance, on every successful or
unsuccessful attempt to login to the Internet banking account, banks can keep consumers
informed by an auto generated short-massage-service on their registered mobile numbers.
The banks can transmit a massage that promotes trust-pay for consumer using IB by
providing unconditional loss guarantees. Although, the influence of perceived risk on IB
adoption is disregarded due to presence of other variables in this study, its adverse effects
cannot be underestimated. The recent media stories about online frauds, scams, hacking
and computer viruses can intensify and trigger the risk concerns of Internet banking users.
Therefore, banks can develop risk-reducing strategies that can instill confidence in
consumers. For example, banks can focus on prevention of fraud; identify theft and
intrusion by strengthening encryption, installing secure firewalls, and by adopting
multilevel-authentication. Furthermore, more attention can be focused in communicating
security measures undertaken by banks to consumers regarding IBS.

Although, developing useful and user-friendly system is essential, current study
shows that amplifying user enjoyment and website features would increase consumers’
perceptions of system usage. High levels of enjoyment and value-services will encourage
consumers to bank online. Therefore, system developers can consider developing more
enjoyable technology-oriented IB systems with value-added features covering the
mundane needs of the consumers in order to increase adoption rates.
7. Limitations and directions for future research
There is always the issue of generalizability in consumer behavior research, and the
present study is no exception. First, the web based survey is conducted as per convenience
of respondents. Thus, generalizability can be enhanced if future research is systematically
sampled from a more dispersed sample through multi-model survey (online and offline
surveys). Second, the sample of this study comprised only of active Internet banking users.
Thus, generalizability of the results to non-users or to the dormant users of Internet
banking cannot be claimed. Future research can include non-users or the dormant users of
IBS into the sample to determine whether the findings of this study can be generalized.
Third, the findings and the implications of this research are obtained using a cross-
sectional study. This reduces the ability of the study to reflect the temporal changes in the
research constructs. A longitudinal study on the subject is necessary in order to clarify the
effects of temporal changes. Finally, the current study focuses on some technological,
behavioral and attitudinal factors such as website design, enjoyment, trust, perceived risk
and social influence. There are, however, many consumer specific factors, such as self-
efficacy, technology readiness, age, income, gender, experience, etc. and other
psychographic and behavioral factors such as perceived value, service quality and
satisfaction, which can provide more significant insights into adoption process.
End notes
22
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Author Biographical Details:
Irfan Bashir is a Doctoral Research Scholar in the Department of Management, Pondicherry

University–Karaikal Campus. His research interests are primarily in the areas of service
management/marketing, innovation management, and customer relationship management. His
academic work has appeared in several international refereed journals including Journal,
International Journal of Quality in Service Sciences (Emerald Publications), International Journal of
Qualitative Research in Services (INDERSCIENCE Publications), Vision–Journal of Business
Perspective (SAGE Publications), METAMORPHOSIS–A Journal of Management Research (Indian
Institute of Management Lucknow), Asia Pacific Marketing Review, PRAJNAN–Journal of Social and
Management Sciences, ABHIGYAN, etc. He has presented papers at various national and
International conferences. Irfan Bashir can be contacted at; irfanbashir18@gmail.com
Dr. C. Madhavaiah is an Assistant Professor of Marketing in the Department of Management,

Pondicherry University - Karaikal Campus, Karaikal, Puducherry, India. He is a doctorate from Sri
Venkateswara University, Tirupati, India. He has 12 years of experience in teaching and research.
His areas of research are service quality, technology adoption behavior of customers, brand equity,
consumer behavior in luxury fashion brands, and consumer misbehavior. He published a book on
Measuring Service Quality in Banking Sector (2014) for Lambert Publishers, Germany. He has
published more than 40 research articles in refereed national and international journals including
Journal of Marketing & Communication, Asia-Pacific Business Review (Sage Publications), Vision -
Journal of Business Perspective (Sage Publications), Asia-Pacific Marketing Review, Prajnan, Journal
of the Insurance Institute of India, The ICFAI Journal of Services Marketing, Serbian Journal of
Management, Udyog Pragati, Amity Business Review, etc. He organized national level management
meets, national conferences and research methodology workshops. C. Madhavaiah can be contact
at: drcmadhavaiah@gmail.com
31
Table I: A Summary of literature on Internet banking adoption in India
Theoretical Sample size and Data analysis
S. No. Study basis Constructs used method tools
1 Agarwal et al., (2009) --NA-- Security, trust, 320 e-banking users Factor analysis
convenience, ease of use, Quota sampling
value
2 Bhatt (2011) TPB BI, ATT, SN, PBC 150 bank customers Regression
Judgment Sampling analysis
3 Dash et al., (2011) TAM PU, PEOU, SI, ATTI, BI, 295 IB users SEM
Random
4 Dash et al., (2012) --NA-- PR, ATT 260 customers ANOVA,
Systematic sampling Regression
Analysis
5 Dixit and Datta --NA-- Security and privacy, 200 adults Factor
(2010) trust, familiarity, Analysis,
innovativeness,
awareness
6 Kalaiarasi and IDT BI, Relative advantage, 85 engineering students SEM
Srividya (2012) compatibility, complexity,
trialability, risk
7 Kesharwani and TAM PU, PEOU, PWD, BI, TRT, 619 IB users EFA, SEM
Bisht (2012) PBC, SI, PR Convenience sampling
8 Kesharwani and TAM PR, PU, PEOU, SI, SEF, 410 traditional bank EFA,
Tripathy (2012) Pricing concerns, customers Regression
technological complexity Analysis
9 Khare and Singh --NA-- ATT, information 204 users and non-users Correlation
(2012) availability, security, of IB and ANOVA
accessibility
10 Khare et al., (2010) TAM Personality dimensions, 323 online banking Correlation,
PEOU, PU, security and users ANOVA and
privacy, amount of Random sampling Regression
information, PENJ Analysis
11 Kumra and Mittal --NA-- Trust, social bond, 192 IB users Regression
(2004) communication, Analysis
opportunistic behaviour,
trust credibility, trust
benevolence
12 Mann and Sahni --NA-- --NA-- 350 IB users Cluster
(2012) Convenient sampling Analysis
13 Safeena et al., (2010) TAM PU, PEOU, Awareness, PR, 53 students Factor
BI Convenience sampling Analysis
14 Safeena et al., (2011) TAM PU, PEOU, USE, PR. 116 Students Factor
Convenience sampling Analysis,
Regression
Analysis
15 Sharma and TAM SI, PU, PEOU, IB 344 bank customers SEM
Srikrishna (2014) awareness, quality of Random sampling
Internet connection, SEF,
ATT, INT
16 Varaprasad et al., IDT, TAM PU, PEOU, PR, Relative 672 students Factor
(2013) advantage, trialability, Convenience sampling Analysis,
Conspicuousness, BI Regression
Analysis
17 Bashir and TAM TRT, SEF, SI, PR, PU, 155 Students Correlation,
Madhavaiah (2014) PEOU, BI Convenience sampling and
Regression
Analysis
--NA-- : Not Available
Table II. Summary of demographic profile of respondents (n=697)
Demographic Item Frequency Per cent (%)
Characteristic
Gender Male 475 68.10
Female 222 31.90
Age 18-25 Years 210 30.10
26-35 Years 391 56.10
36-45 Years 68 09.80
46-55 Years 16 02.30
>55 Years 12 01.70
Marital Married 253 36.30

Status Unmarried 444 63.70
Level of < `10,000 162 23.20
Income ` 10,000 - 30,000 277 39.70
` 30,001 - ` 50,000 125 17.90
` 50,001 - ` 1,00,000 70 10.00
> ` 1,00,000 63 09.00
Employment Student 260 37.30
Status Self-Employed 47 06.70
Employed 473 19.5
Unemployed 17 02.40
Level of Up to Secondary School/Diploma 34 04.90
Education Bachelor's Degree 136 19.5
Master's Degree 418 60.0
Doctoral Degree 109 15.6
Area of Urban 453 65.0
Residence Rural 106 15.2
Semi-Urban 138 19.8
H1c
Trust
H1a H1b
Perceived
H2a H5b
Risk
H5a
Perceived H6b
Website Design H2b H5c
H2c Perceived H6a Attitude H8 Behavioral

Usefulness towards IBS Intention
H3a
Perceived
Enjoyment H7a
H3b
Perceived H7b
H4a
Ease of Use H7c
H4b
Social H4c
Influence
H4d
Figure I: Proposed Research Model
Table III. Statistics of CFA model fit (n=697)

Goodness-of-fit indices Recommended Literature Initial CFA Revised CFA
value model model
Chi-square (χ2) Byrne (2010); 1236.15 685.848
Hair et al., (2013);
Degrees of freedom (df) 386 364
Kline (2011).
Relative Chi-square (χ2/df) 1-3 3.202 1.884
Goodness-of-fit (GFI) ≥0.90 0.815 0.939
Adjusted goodness-of-fit (AGFI) ≥0.90 0.802 0.922
Normed fit index (NFI) ≥0.90 0.847 0.962
Comparative fit index (CFI) ≥0.90 0.890 0.982
Root mean square error of <0.05
0.068 0.036
approximation (RMSEA)
Table IV. Construct reliability and convergent validity
Observed Standardized CR AVE MSV ASV Cronbach’s
Latent variable
variables loadings (>0.7) (>0.70) (>0.50) <AVE <AVE alpha
PU1 .832 0.948 0.784 0.672 0.283 0.950
Perceived Usefulness PU2 .875
PU3 .883
PU4 .920
PU5 .913
Attitude ATT1 .858 0.941 0.763 0.619 0.335 0.946
ATT2 .818
ATT3 .877
ATT4 .907
ATT5 .904
Perceived Risk PR1 .722 0.887 0.725 0.216 0.071 0.880
PR2 .924
PR3 .894
PR5 .711
Perceived Website PWD2 .850 0.892 0.734 0.393 0.264 0.892
Design PWD3 .872
PWD4 .848
Social Influence SI1 .749 0.884 0.719 0.040 0.016 0.880
SI2 .934
SI3 .850
PENJ1 .708 0.830 0.627 0.498 0.252 0.864
Perceived Enjoyment
PENJ2 .789
PENJ3 .949
BI1 .714 0.922 0.856 0.623 0.299 0.921
Behavioral Intention
BI2 .802
BI4 .908
BI5 .942
Trust TRT1 .887 0.896 0.811 0.386 0.232 0.814
TRT2 .914
TRT4 .706
TRT5 .811
PEOU2 .877 0.881 0.712 0.672 0.321 0.879
Perceived Ease of Use
PEOU3 .751
PEOU4 .896
PEOU5 .755
Note: CR= composite reliability; AVE= average variance extracted; MSV= Maximum shared
variance; ASV= average shared variance
Table V. Discriminant validity
TRT PU ATT PR PWD SI PENJ BI PEOU
TRT 0.901
PU 0.394 0.885
ATT 0.621 0.641 0.874
PR -0.465 -0.193 -0.298 0.851
PWD 0.588 0.521 0.621 -0.240 0.857
SI 0.137 0.079 0.120 0.072 0.157 0.848
PENJ 0.396 0.655 0.572 -0.132 0.529 0.123 0.792

BI 0.609 0.532 0.787 -0.286 0.627 0.199 0.544 0.821
PEOU 0.457 0.820 0.668 -0.259 0.594 0.065 0.706 0.562 0.844
Note: The square-root of AVE (shown in italics at diagonal)and off diagonal are inter-construct
squared correlations
Table VI. Results of path analysis

Hypothesis Path Estimate Critical Standardized Significance Supported
ratio regression Level or not
weights (β)
H1a TRT → PR -0.448 -09.362 -0.504 *** Yes
H1b TRT → ATT 0.334 11.497 0.309 *** Yes
H1c TRT → BI 0.181 04.679 0.127 *** Yes
H2a PWD→ PR 0.038 00.765 0.032 0.443(ns) No
H2b PWD → PU 0.021 00.509 0.026 0.610(ns) No
H2c PWD → PEOU 0.282 05.611 0.256 *** Yes
H3a PENJ → PU 0.171 03.422 0.143 *** Yes
H3b PENJ → PEOU 0.655 11.154 0.535 *** Yes
H3c PENJ → ATT 0.126 02.623 0.095 0.008** Yes
H3d PENJ → BI 0.181 03.260 0.114 0.001** Yes
H4a SI → PR -0.114 -03.584 -0.136 *** Yes
H4b SI → PU 0.009 00.426 0.011 0.670(ns) No
H4c SI → PEOU -0.051 -01.867 -0.056 0.061(ns) No
H4d SI → BI 0.099 04.014 0.081 *** Yes
H5a PR → ATT 0.010 00.162 -0.013 0.871(ns) No
H5b PR → BI -0.086 -02.770 -0.026 0.005** Yes
H5c PR → PU 0.004 00.153 0.005 0.877(ns) No
H6a PU → ATT 0.208 03.990 0.223 *** Yes
H6b PU → BI -0.028 -00.496 0.008 0.619(ns) No
H7a PEOU → PU 0.669 13.776 0.702 *** Yes
H7b PEOU → ATT 0.190 03.298 0.165 *** Yes
H7c PEOU → BI 0.010 00.167 0.058 0.867(ns) No
H8 ATT → BI 0.765 15.297 0.553 *** Yes
Notes:*p<0.05;**p<0.01;***p<0.001; ns= not significant
Trust
Perceived
Risk
Perceived
Website Design
Perceived Attitude Behavioral

Usefulness towards IBS Intention
Perceived
Enjoyment
Perceived
Ease of Use
Social
Influence
Figure II: Results of revised structural model
Note: Relationships shown as thick lines indicate significant and dotted lines indicate non
significant relationships.
Table VII. Direct, indirect and total effects on usefulness, attitude and intention
Perceived Usefulness Attitude Behavioral Intention
Direct Indirect Total Direct Indirect Total Direct Indirect Total

effects effects effects effects effects effects effects effects effects
TRT 0.001 0.072 0.073 0.310** 0.041 0.351** 0.128** 0.202** 0.330**
PENJ 0.144** 0.376** 0.520** 0.095* 0.205** 0.300** 0.115* 0.139** 0.254**
SI 0.011 -0.039* -0.028 0.011 -0.018 -0.006 0.081** -0.004 0.077**
PWD 0.027 0.18** 0.207** 0.165 0.088** 0.253** 0.161 0.126* 0.287*
PEOU 0.702** − 0.702** 0.165* 0.157** 0.323** -0.059 0.185** 0.126**
PR 0.005 − 0.005 -0.013 0.001 -0.012 -0.026** -0.007 -0.033**
PU − − − 0.224** − 0.224** 0.009 0.124** 0.133
ATT − − − − − − 0.553** − 0.553**
*Significant at p< 0.05.
**Significant at p< 0.01.
Appendix A. The construct items and their sources
Label Items Literature
Perceived Usefulness
PU 1 Using internet banking improves functioning of my banking activities. Giovanis et al. (2012); Nor
PU 2 Internet banking allows me to manage my banking activities more efﬁciently. et al. (2010); Cheng et
PU 3 Internet banking enables me to complete my banking activities conveniently. al.(2006); Manzano et
PU 4 Internet banking enables me to complete my banking activities more quickly. al.(2009)
PU 5 Overall, I find internet banking very useful for carrying out my banking activities.
PU 6 In general, I find using internet banking advantageous than branch banking.
Perceived ease of use
PEOU 1 It is easy to use internet banking Cheng et al. (2006);
PEOU 2 Learning to use internet banking is easy Nor et al., (2010)
PEOU 3 The instructions provided on my internet baking website are clear and understandable.- Giovanis et al. (2012);
PEOU 4 I find it easy to remember how to use internet banking. Manzano et al. (2009);
PEOU 5 Overall, I find the use of the Internet Banking services easy.
Perceived enjoyment
PENJ 1 Using internet banking service is fun. Venkatesh and Bala (2008);
PENJ 2 I find using internet banking service to be enjoyable. Pikkarainen et al., (2004)
PENJ 3 The actual process of using internet banking service is pleasant.
Perceived risk
PR 1 I think that my money will get stolen whenever I transact through internet banking. Zhao et al. (2008);
PR 2 I believe that others can get access to my personal details. Manzano et al. (2009);
PR 3 I believe that others will misuse my data. Grabner-Krauter and
PR 4 I think using internet banking for banking operations consumes a lot of time. Faullant (2008)
PR 5 Internet banking service may process payments incorrectly.
PR 6 I feel frustrated using internet banking services.
Social influence
SI 1 Only after getting favorable reactions from others, I started to use Internet banking.
SI 2 People, who influence me, suggested that I should use internet banking. Lee (2009)
SI 3 People, whose opinions are important to me, recommended me that I should continue to
use internet banking.
Trust
TRT 1 I believe that it is always safe to transfer money using internet banking. Suh and Han (2002);
TRT 2 I believe it is reliable to transfer money using internet banking. Nor et al. (2010)
TRT 3 My bank promptly informs me whenever anything goes wrong with any of my
transactions.
TRT 4 I am confident that my transaction through internet banking will always be transparent
because of the regulator, RBI
TRT 5 Based on my past experience, I can say that using internet banking is trustworthy.
Website design
PWD 1 It is very easy to navigate through the internet banking website, I use. Cyr et al.(2008)
PWD 2 All service options, service attributes and service information are well designed and
presented.
PWD 3 I can easily recognize and find where the service information is located on my internet
banking website.
PWD 4 The screen design of my internet banking website (i.e. colors, boxes, menus, navigation
tools, etc.) is good and well presented.
Attitude
ATT 1 Using Internet banking service is a good decision. Cheng et al. (2006); Suh and
ATT 2 Using Internet banking service is a wise decision. Han (2002); Shih and Fang
ATT 3 Using Internet banking service is a positive step. (2004); Grabner-Kräuter
ATT 4 I like to use Internet banking service. and Faullant (2008)
ATT 5 Overall, my attitude towards internet banking is favorable.
Behavioral intention
BI 1 I intend to increase my use of the Internet banking service in the future. Suh and Han (2002);
BI 2 I expect my transaction through internet banking will increase in future. Walker and Johnson (2006);
BI 3 I will add Internet banking to my favorite links. Shih and Fang (2004); Al-
BI 4 I will encourage my friends and family to use internet banking services. Sukkar (2005)
BI 5 I will strongly recommend others to use internet banking services.

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Journal of Indian Business Research

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Information and communication technology (ICT) has brought a remarkable

literature containing theoretical background, research gap in Indian Internet banking

2.1 Theoretical background

Earlier, studies related to adoption of technology were conducted which sought to

Basic theories related to social psychology

• Theory of reasoned action (TRA; Fishbein and Ajzen, 1975)

Theories/models extended to explain technology adoptions

2.2 Research gap in the Internet banking adoption research in India

<Insert Table I around here>

In an another study, Bhatt (2011) applied Theory of Planned Behavior to investigate

In summary, majority of these studies have concentrated on the importance of the

2.3 Research model and hypotheses

<Insert Figure I around here>

Perceived website design

the use of IBS.

Within the framework of TAM, perceived usefulness is a significant factor affecting

Perceived ease of use

Attitude towards use of IBS

Attitude is defined as “learned predisposition to respond in a consistently favorable or

3.1 Questionnaire design

A structured questionnaire, consisting of three parts, is developed for the purpose of

The measurement instrument, of the second part of the questionnaire, was

3.2 Data collection

<Insert Table II around here>

3.3 Data analysis tools

4. Data analysis and results

4.1 Exploratory factor analysis

Before performing structural equation modelling, an exploratory factor analysis (EFA) is

4.2 Analysis of measurement model

<Insert Table III around here>

4.3 Reliability and validity of the measurement instrument

<Insert Table IV around here>

<Insert Table V around here>

4.4 Analysis of structural model

4.4 Hypothesis testing

<Insert Table VI around here>

<Insert Figure II around here>

<Insert Table VII around here>

6.1 Theoretical contribution

6.2 Methodological contribution

6.3 Managerial contribution

security measures undertaken by banks to consumers regarding IBS.

7. Limitations and directions for future research

Prentice- Hall, Inc: Englewood Cliffs, NJ.

interpersonal influence perspective”, Omega, Vol. 28 No. 6, pp. 725–737.

application”, International Journal of Information Management, Vol. 34 No.1, pp. 1–

Roselius, T. (1971), “Consumer rankings of risk reduction methods”, Journal of Marketing,

Author Biographical Details:

Irfan Bashir is a Doctoral Research Scholar in the Department of Management, Pondicherry

Dr. C. Madhavaiah is an Assistant Professor of Marketing in the Department of Management,

Marital Married 253 36.30

H2c Perceived H6a Attitude H8 Behavioral

Figure I: Proposed Research Model

Table III. Statistics of CFA model fit (n=697)

PENJ 0.396 0.655 0.572 -0.132 0.529 0.123 0.792

Table VI. Results of path analysis

Perceived Attitude Behavioral

Figure II: Results of revised structural model

Perceived Usefulness Attitude Behavioral Intention

Direct Indirect Total Direct Indirect Total Direct Indirect Total

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