An empirical analysis of internet banking adoption in New Zealand

Abstract

Technological developments, particularly in the area of telecommunications and information technology, are revolutionizing the banking industry, including New Zealand’s banking sector. These developments have prompted new delivery channels and banking systems including Automatic Teller Machine (ATM), telephone banking, personal computer banking (PC), and Internet banking. Internet banking has become one of the most rapidly diffused banking technologies. From a bank’s perspective, Internet banking can reduce costs, increase the speed of service, expand the market, and improve overall customer service. From the consumers’ perspectives, Internet banking can lower services fees, and allow customers to manage their finances more conveniently, anytime and anywhere. However, despite the efforts of the banking sector, numerous consumers are still not using Internet banking services. This research investigates the factors that affect consumers’ adoption of Internet banking services in New Zealand.

The findings reveal that User-friendly Website, Marketing Communications, Perceived Risks, Price, and Internet Access/Internet Familiarity have an impact on customers’ decisions to adopt Internet banking. The results also reveal that the Young Age and the High Income Groups are more likely to adopt Internet banking.

The results of this research will help banks and financial institutions to implement efficient services marketing strategies to increase the rate of Internet banking adoption, and in turn, increase banks’ revenue and competitiveness. Furthermore, this research provides useful information for future researchers who study the links between customers’ decision making and Internet banking.