Do Behavioural Biases Drive Adoption of Digital Banking Services? The Moderating Role of User Type

Abstract

Digital banking services have gained increasing acceptance among individuals, but some people still resist using these services. Hence, it is empirical to understand the behaviour of individuals to examine the reasons behind acceptance or rejection of technology. The present study intends to analyse the role of behavioural biases in adopting digital banking services. The study included three behavioural biases: herd behaviour, risk aversion and overconfidence bias. Further, the study examined user type—early and late adopters as a moderating variable for a better understanding of the consumer’s perception. The data for the research has been collected from 411 respondents through a structured questionnaire. The proposed model has been analysed with the help of the Partial Least Squares Structural Equation Modelling approach through SmartPLS software. The findings suggest that behavioural biases, namely overconfidence bias, herd behaviour and risk aversion bias, impacted adopting digital banking services. User type—early adopters and late adopters have also proven significant in the study as the moderating variable. The study will benefit the policymakers, bankers and researchers to contemplate behavioural biases and their influence on digital banking services keeping in mind the role of user types.