Study of neobanking adoption in india: a synthesis of rogers’ diffusion of innovation theory and the technology acceptance model

Abstract

The pandemic greatly accelerated the digitization of banking sector which led to the rise of neobanks. This area has become now one of the fastest growing markets in the country and witnessed the entry of several new players over the past few years. Despite the rapid growth of neobanking in India, there is still a limited understanding of the factors that influence neobanking adoption. Therefore, this research intends to study neobanking adoption using an integration of Rogers’ Diffusion of Innovation theory and Technology Acceptance Model. This research conducts a survey of 502 respondents and analyses the results with statistical techniques of factor loading and regression weights. The sampling technique used for this study was convenience sampling. Based on the results of these techniques, the findings were that observability, compatibility and complexity have a significant influence on the perceived ease of use as well as the perceived usefulness, and then these two factors influence the behavioural intentions of consumers towards neobanking. Thus, trialability and relative advantage do not influence perceived usefulness as well as perceived ease of use, and subsequently behavioural intentions of consumers for neobanking. The study concludes by offering neobanks practical suggestions to enhance the innovation’s adoption rate in India.