Factors Affecting Electronic Banking Adoption in Barbados

The low rate of customers' adoption of electronic banking services affects retail banks' profitability. The operating cost for a financial transaction performed by bank tellers averages US$1.07 compared to US$0.01 using electronic banking channels. It is paramount for retail banking leaders to understand the factors influencing customer adoption of electronic banking to sustain competitive advantage. Grounded in the technology acceptance model framework, the purpose of this quantitative correlational study was to examine the relationship between perceived usefulness (PU), perceived ease of use (PEOU), and customer adoption of electronic banking in Barbados. The validated technology acceptance model survey instrument was used to collect 72 responses from bank account holders living in Barbados who owned a mobile smartphone or a computer and used electronic banking services (mobile or online banking). A multiple regression analysis confirmed that the model as a whole was able to significantly predict customer adoption of electronic banking services: F(2, 69) = 123.503, p < .001. Both PU and PEOU were statistically significant with PEOU (t = 6.249, p < .01, β = .574) accounting for a higher contribution to the model than PU (t = 3.883, p < .01, β = .357). A key recommendation is that retail banking leaders provide customers with educational resources to aid in increasing their usage of electronic banking services. The implications for positive social change include an improved understanding of electronic banking services to residents, increased awareness of the availability of electronic banking services to retail banking customers, and expanded access to affordable financial services for individuals in Barbados.