The Influence of Economic Perception on the Adoption of App-based Financial Transactions: A Study Among the Young Population in India

Abstract

Various sectors have been undergoing major changes due to digitalisation. Among these sectors, the finance sector is one which is largely affected due to online banking, cash to cashless, and so on, and digital finance instruments in India have witnessed a revolutionary change over the last decade. By financial instrument, we refer to the various digital financial apps which are used for online cashless transactions such as Paytm, Google Pay, Amazon Pay, PayZapp and so on. The primary emphasis of this research is on the wide range of digital financial instruments and their subsequent adoption in India, based on a survey conducted on 600 individuals (young) from July to October 2021. The study will offer brief discussions of the advantages of utilising these instruments, the challenges of using these instruments, other variables that are keeping individuals from using these apps, and so on. Questionnaire distribution and collection is the major data-gathering approach used to learn about people’s views on these financial products. Attitude, perception and social norms are briefly reviewed and analysed as they pertain to the individual’s decision and intention to utilise digital apps. Following the expected utility theory people are rational, and we find evidence that during economic crises economic entities behave differently and economic incentives may not often work if they have a strong negative perception of the economy. Our result strengthens these arguments, it reveals that economic perception considerably moderated the connection between perceived usefulness and mobile apps for money transactions (MAMT) use implying that economic perception strengthens the impact of the independent variable. On the other hand, the result shows that economic perception significantly weakens the impact of social influence on the usage of MAMT. However, the perceived economic crisis has no moderating impact on the relationship between perceived ease of use and usage of MAMT. This has something to do with innovation, and creating intrinsic product or service-based value addition that hardly changes with the economy’s perception—whether it is in crisis or a business-as-usual. The present study in the Indian context contrasts with most of the literature that concludes based on pre-COVID scenarios, and, thus, has wider business implications in the new-normal world. Mobile app developers now should emphasise factors while optimising and designing their pricing and promotional strategies.