A Cross-national Study
Tommi Laukkanen
Department of Business and Management, University of Kuopio, Kuopio, Finland
Pedro Cruz
Instituto Superior de Gestao, Lisbon, Portugal
Keywords: Innovation resistance, Adoption, Mobile phone, Banking.
Abstract: The objective of this study is to explore barriers to mobile banking adoption in two distinct European
countries namely Finland and Portugal. Even successful innovation may face various types of resistance that
may paralyse customers' desire to adopt or use the innovation. We investigated the country effect to five
adoption barriers namely usage, value, risk, tradition and image, derived from the earlier literature. An
Internet questionnaire was developed and 3.597 usable responses were collected. A confirmatory factor
analysis was implemented with SEM to build the constructs’ latent score levels. Using non-parametric
difference tests we concluded that the resistance is significantly lower among the Portuguese online bank
customers in terms of four out of the five barriers. The results can be used for a better understanding and
enhancement of adoption of this specific case of m-commerce.
The wide penetration and rapid diffusion of mobile
phones has opened opportunities for new
innovations in the services sector. One such
innovation is mobile banking representing one of the
most promising, while still marginally adopted, m-
service. Previous studies have shown that mobile
banking increases efficiency and convenience in bill
paying, for example, as the service can be used
wherever wanted enabling time savings and
immediate reactions to unexpected service need
(Laukkanen and Lauronen, 2005; Laukkanen,
Finland has long been seen as the most
successful European country in terms of the
adoption and use of mobile services (Bouwman et
al., 2007). However, even though already around
two thirds of the Finns pay their bills over the
Internet, mobile banking has not yet received the
attention of the masses. In general, Finland is
referred as one of the leading European countries in
terms of Internet banking adoption, while, for
example, Portugal is lacking far behind (Eurostat,
2007). In this study we investigated what inhibits
mobile banking adoption in these two European
countries and how the countries differ in terms of
barriers to the service adoption.
First we describe the Internet and mobile
communications market both in Finland and
Portugal. Thereafter, we summarise the relevant
literature on innovation resistance and banking
technologies. Finally, the findings are presented and
concluding remarks drawn.
During the last decade the penetration of mobile
phones has been dramatic. In addition, the diffusion
of Internet-connected computers has been
remarkable in the 21
century. These advances in
communication technologies have reshaped the
service development and revolutionised the service
consumption. In Finland the amount of Internet-
connected computers per 100 persons have grown
from roughly 20 in 2002 to nearly 50 in 2006
Laukkanen T. and Cruz P. (2008).
In Proceedings of the International Conference on e-Business, pages 300-306
DOI: 10.5220/0001907003000306
(Figure 1). Compared to Portugal, the relative
amount of these devices is over three times higher in
Finland. These figures may partly explain the higher
Internet banking adoption rates in Finland, even
though the growth rate of these devices in Portugal
has been dramatic during the last years.
2002 2003 2004 2005 2006
Finland Portugal
Figure 1: Internet-connected computers per 100 persons
(Statistics Finland, 2008).
2002 2003 2004 2005 2006
Finland Portugal
Figure 2: Mobile telephone subscription per capita
(Statistics Finland, 2008).
Although the distribution and penetration of
mobile handsets in Finland is argued to be among
the highest in the world, making the country an
interesting test-market for new mobile services
(Bouwman et al., 2007), the number of mobile
phone subscriptions is even higher in Portugal with
1,16 connections per capita compared to 1,08 in
Finland. The relatively low number of computers
connected to the Internet and a great number of
mobile phones make Portugal a highly potential
market for mobile services such as banking.
The future of mobile communications relies
heavily on services. However, the optimistic and
experimental mood that we witnessed in the
beginning of the century has been replaced by a
cautious atmosphere in which fewer risks are taken
in the development and marketing of new third
generation mobile services (Bouwman et al., 2007).
Therefore, insight into the reasons why consumers
are not adopting mobile services is needed. In this
paper we explore the adoption barriers to mobile
banking in the light of consumer resistance to
Albeit the pro-innovation bias (Sheth, 1981; Ram,
1987; Rogers, 2003) that majority of the diffusion
literature has, there may be product and service
categories or market segments where innovation
resistance is predominant (Gatignon and Robertson,
1991). The literature on innovation resistance aims
to explore the various reasons that inhibit innovation
adoption. Sheth (1981) suggests that the two key
factors explaining the phenomenon are habit or
satisfaction with an existing behaviour and
perceived risks associated with innovation adoption.
He states that the inclination toward an existing
behaviour is related to the typical human tendency to
strive for consistency and status quo rather than to
continuously search for new behaviours.
Consequently Ellen et al. (1991), note that
satisfaction with current performance increases
resistance to alternatives and reduces the likelihood
of adoption. They further highlight the role of
perceived self-efficacy which means the perceived
ability or skill to successfully perform a given task.
These lines of thought assume that consumers base
their decisions on two aspects: perceived benefits
over existing methods and perceived risks associated
with innovation adoption.
Ram and Sheth (1989) suggest a more
comprehensive view on innovation resistance by
explaining the phenomenon with five adoption
barriers namely usage, value, risk, tradition and
3.1 Usage Barrier
Ram and Sheth (1989) suggest that the usage barrier
relates to the situation in which an innovation is not
compatible with existing workflows, practices or
habits. In the context of technological innovations,
however, this construct parallels with complexity
which, according to Rogers (2003), refers to the
degree to which an individual considers an
innovation to be relatively difficult to understand
and use.
The small size of mobile devices including small
screens and tiny multifunction keypads may be
troublesome to use and hamper the usability of
mobile services. Earlier studies on mobile banking
show that the smaller screens appear adequate in
information-based mobile services, such as request
for account balance service, but those banking
services that involve transactions require a bigger
screen size (Laukkanen, 2007b). For example, some
bank customers consider bill payment via mobile
handheld device to be difficult and time consuming
as the device enables only a limited amount of
information processing and for this reason, the
whole bill is not visible on the display inhibiting the
progress in the service process (Laukkanen and
Lauronen, 2005; Laukkanen, 2007a). Moreover,
some studies highlight the importance of simple
authorization mechanisms in mobile banking
(Laukkanen and Lauronen, 2005) while some report
inconvenience due to changing PIN codes among
some bank customers as the codes need to be carried
along (Kuisma et al., 2007).
3.2 Value Barrier
The degree to which an individual believes that an
innovation is better than the idea it supersedes
determines the individual's decision to use the
innovation (Rogers, 2003). This is called relative
advantage which is a related concept with the value
barrier referring to the performance and monetary
value of an innovation in comparison to its
substitutes (Ram and Sheth, 1989).
In similar vein, the greater the perceived
advantage that mobile banking offers over other
ways of banking, the more likely it is to be adopted
(Brown et al., 2003). The earlier studies show that
the option to check the movements or transactions of
an account wherever wanted increases customers'
feeling of control over their financial affairs adding
value to service consumption (Laukkanen and
Lauronen, 2005).
However, if an innovation does not offer greater
performance to existing alternatives, it is not
worthwhile for consumers to change their behaviour
(Ram and Sheth, 1989). The extent to which an
individual believes that using mobile banking is
uneconomical, for instance, has a negative effect on
the intention to use mobile banking (Luarn and Lin,
3.3 Risk Barrier
The risk perceptions in technological innovations
usually arise due to the uncertainty to the
technology’s capability to deliver its expected
outcome (Im et al, 2008). Thus, the diffusion of
innovation is likely to take the longer the more risk
adverse the innovation is (Dunphy and Herbig,
As with many other technological innovations,
there appear to be security and privacy concerns to
mobile banking among some bank customers (Luarn
and Lin, 2005). Safety measures of personal details
and financial information by the bank are one of the
critical factors for the commercial success of mobile
banking (Brown et al., 2003). A portable list of PIN
codes may also pose security threats as it may be
lost by a customer and found by an untrustworthy
party (Kuisma et al., 2007).
Moreover, the extent to which a person believes
a new technology will perform a job consistently
and accurately (i.e. reliability) is highly important
risk-related factor in technology-based financial
service innovations (Lee et al., 2003). Mobile
phones, for instance, may be limited in
computational power, memory capacity and battery
life, limiting the use of mobile services (Siau and
Shen, 2003).
3.4 Tradition Barrier
The tradition barrier is related to the change an
innovation may cause in a consumer's daily routines.
Thus, if the consumer considers routines important
in his/her daily behaviour, the tradition barrier will
most likely be high. Moreover, the tradition barrier
may arise when an innovation is incompatible with
the consumer's existing values, norms and past
experience (Ram and Sheth, 1989). Thus, an
innovation needs to be well-suited with the existing
values and norms in order an individual to adopt the
innovation (Rogers, 2003).
Kuisma et al. (2007) showed that some
consumers resist Internet banking due to their habit
of paying bills via bill paying ATMs. Alternatively,
a customer may need social interaction and enjoy
talking to bank personnel as a strong desire to deal
with human tellers is found to discourage consumer
from adopting self-service technologies in banking
(Marr and Prendergast, 1993). Thus, it may be that
in mobile banking the tradition barrier arises if an
individual simply prefers to deal directly with the
bank clerk instead of using new banking
3.5 Image Barrier
The image barrier arises from unfavourable
associations to the identity of the innovation, such as
the country of origin, brand or the product category
to which the innovation belongs (Ram and Sheth,
ICE-B 2008 - International Conference on e-Business
1989). In the case of technological innovations, for
instance, image barrier may derive from a negative
image of new technology in general and of a product
class in particular.
In the late 90’s Fain and Roberts (1997) argued
that the image barrier in online banking derives from
a negative hard-to-use image of computers and the
Internet. We argue that this may well be the case in
mobile banking today as some consumers may
perceive the mobile technology to be too difficult to
use and therefore instantly form a negative image of
the service related to the mobile technology.
3.6 Hypotheses Development
Following the earlier literature on innovation
resistance a research model was designed (Figure 3).
According to the Eurostat’s (2007) statistics, Finland
is among the leading European countries in terms of
individuals’ Internet banking adoption with 63
percent adoption rate in 2006. Portugal, for example,
represents the opposite with only 10 percent
adoption rate. Based on these facts we hypothesise
that the resistance to electronic banking services,
including mobile banking, is significantly lower
among the Finns compared to Portuguese bank
customers. This leads us to the following
H1: Usage barrier to mobile banking is significantly
lower among the Finns compared to Portuguese
H2: Value barrier to mobile banking is significantly
lower among the Finns compared to Portuguese
H3: Risk barrier to mobile banking is significantly
lower among the Finns compared to Portuguese
H4: Tradition barrier to mobile banking is
significantly lower among the Finns compared
to Portuguese
H5: Image barrier to mobile banking is significantly
lower among the Finns compared to Portuguese
H6: Overall resistance to mobile banking is
significantly lower among the Finns compared
to Portuguese
Based on the theory of innovation resistance and the
existing literature on banking technologies,
especially on mobile banking, a survey questionnaire
was designed. The five adoption barriers were
examined with 17 statements expressed in Table 1.
A seven-point Likert scale ranging from totally
disagree (1) to totally agree (7) was used.
Figure 3: Conceptual model.
Table1: Measure development of the barriers.
Statements measuring the barriers
Usage barrier
B1. In my opinion, mobile banking services are easy to use *
B2. In my opinion, the use of mobile banking services is
convenient *
B3. In my opinion, mobile banking services are fast to use *
B4. In my opinion, progress in mobile banking services is clear *
B5. The use of changing PIN codes in mobile banking services is
convenient *
Value barrier
B6. The use of mobile banking services is economical *
B7. In my opinion, mobile banking does not offer any advantage
compared to handling my financial matters in other ways
B8. In my opinion, the use of mobile banking services increases
my ability to control my financial matters by myself *
Risk barrier
B9. I fear that while I am paying a bill by mobile phone, I might
make mistakes since the correctness of the inputted information
is difficult to check from the screen
B10. I fear that while I am using mobile banking services, the
battery of the mobile phone will run out or the connection will
otherwise be lost
B11. I fear that while I am using a mobile banking service, I
might tap out the information of the bill wrongly
B12. I fear that the list of PIN codes may be lost and end up in
the wrong hands
B13. I trust that while I am using mobile banking services, third
parties are not able to use my account or see my account
information *
Tradition barrier
B14. Patronizing in the banking office and chatting with the
teller is a nice occasion on a weekday
B15. I find self-service alternatives more pleasant than personal
customer service *
Image barrier
B16. In my opinion, new technology is often too complicated to
be useful
B17. I have such an image that mobile banking services are
difficult to use
*Reversed scale
Usage barrier
Value barrier
Risk barrier
Tradition barrier
Image barrier
The questionnaire was first designed in Finnish
and thereafter translated to English. The English
questionnaire was then translated to Portuguese. The
questionnaires both in Finland and Portugal were
placed in a log-out page of large banks’ online
service. Due to a vast number of online banking
users in Finland the questionnaire was open much
longer in Portugal than in Finland. In Finland the
questionnaire was open for 72 hours between
November 6
and 9
2006, whereas in Portugal the
questionnaire was open for 2 weeks, between June
and July 13
2007. The surveys generated a
total random sample of 3597 usable responses
without missing values.
The Finnish sample is slightly male dominated
(53%) and relatively young with 36.7 percent of the
respondents being less than 35 years old. Finnish
sample consisted of a total number of 1.494 valid
responses of which 28 percent (419 cases)
represented mobile banking users. The Portuguese
sample is largely male dominated (61%) and even
younger than the Finnish sample with 59.3 percent
of the respondents being less than 35 years old. A
total number of 2.103 valid responses were obtained
from Portugal with 32.7 percent (688 valid cases) of
mobile banking users.
In the data analysis phase the scales of positively
formed statements were reversed so that the scales
of all statements were comparable. Thus, a higher
mean of a statement determines higher resistance of
the respondent. A Structural Equation Model (with
AMOS 7.0 software) was estimated and its fit and
constructs’ reliability was checked. Latent scores
were also computed at the constructs’ level. Using
non-parametric tests (Kolmogorov-Smirnov Z and
Mann-Whitney U), the differences between the
countries were assessed (variables and latent scores
did not follow normal distribution).
The constructs’ Cronbach’s Alphas indicated
satisfactory internal consistency reliability
(usage=0,92; value=0,60; risk=0,80; tradition=0,59;
image=0,65) and the estimated structural model
showed an acceptable fit (χ
=2896,10; d.f.=115;
p=0,00; CFI=0,90; RMSEA=0,08; GFI=0,91). All
coefficients revealed to be significant.
The second order structural model showed that
the resistance to the adoption of mobile services
mainly derives from usage (standardized structural
impact=0.93) and value (0.84) barriers. Image and
risk barriers also influenced the overall resistance,
the effects being 0.51 and 0.31 respectively. On the
other hand, tradition had a negative influence to the
overall resistance, with a standardized structural
coefficient of –0.15.
Figure 4: Standardized parameter estimates.
The latent scores were calculated using
Kolmogorov-Smirnov Z and Mann-Whitney U tests.
Both tests showed statistically significant differences
to the five constructs and overall resistance level
(Table 2). Apart from the tradition barrier, the
results indicated higher values for Finland in all the
barriers explored.
Table 2: Resistance levels across countries (latent scores).
Overall resistance
4,052 3,516 0,000
Value barrier
3,058 2,781 0,000
Image barrier
2,345 2,159 0,000
Tradition barrier
3,555 4,047 0,000
Risk barrier
3,879 3,594 0,000
Usage barrier
4,241 3,588 0,000
Table 3: Resistance levels across countries among non-
users (latent scores).
Overall resistance
4,516 3,907 0,000
Value barrier
3,420 3,083 0,000
Image barrier
2,583 2,287 0,000
Tradition barrier
3,514 3,828 0,000
Risk barrier
4,114 3,752 0,000
Usage barrier
4,727 4,011 0,000
In addition, differences between countries were
computed only for non-users of mobile banking
(Table 3). Out of the total number of 3597 responses
2490 respondents represented this group of
Mobile banking
Usage barrier
Value barrier
Risk barrier
Tradition barrier
Image barrier
– 0.15
ICE-B 2008 - International Conference on e-Business
customers with 1075 and 1415 observations in
Finland and Portugal respectively. The results of
these responses follow the research results of the
total sample. Therefore, the hypotheses H1, H2, H3,
H5 and H6 are rejected and only the hypothesis H4
is supported by the data in terms of both the total
sample and the sample of non-users.
The structural equation model showed that usage
and value barriers are the most intense determinants
of overall resistance to mobile-banking, followed by
image and risk barriers respectively. These results
suggest that functional usability and relative
advantage compared to other ways of banking are
currently the most powerful inhibitors of mobile
banking adoption. Interestingly, tradition appeared
to be a negative determinant of resistance.
Furthermore, Portuguese online bank customers
showed less resistance in terms of usage, value, risk
and image to adopting mobile banking services than
their Finnish counterparts. However, Portuguese
online bank customers showed greater preference for
personal service, indicating more traditional banking
behaviour compared to Finns. This idiosyncrasy of
the Portuguese could mean a high pre-disposition to
adopt new service channels alongside with more
traditional ones.
Compared to Finland, the relatively low
resistance scores to mobile banking among the
Portuguese may reflect the fact that Portugal has
simultaneously a low number of internet-connected
computers and a high mobile penetration, a situation
very auspicious for mobile services (Narinder,
2007). Another explanation for such surprising result
might be related to the sampling method as only
online banking users participated in the study.
Rogers (2003) argues that adopter categorisation is
based on innovativeness, i.e. the degree to which an
individual is relatively earlier in adopting new ideas
than other members of a social system. The fact that
only the Innovators and Early Adopters of the total
population in Portugal have so far adopted Internet
banking, and that in Finland the diffusion of the
innovation has already reached the Late Majority,
may have resulted that, in general, the Portuguese
sample consisted of more innovative individuals
than the Finnish sample.
In general, innovativeness is related to
demographics such as age. In our study the
Portuguese sample consisted of much younger
respondents compared to the Finnish sample. Future
research is needed related to the role of
innovativeness and demographic variables in mobile
banking adoption. Moreover, Finland and Portugal
represent very divergent countries in terms of
cultural dimensions (e.g. Hofstede, 1980), hence
providing good means to study the effect of culture
(Kivijärvi et al., 2007). Future research could
investigate the role of culture in consumer resistance
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