Digital Transformationand User Acceptanceof Information Technologyinthe Banking Industry

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Digital Transformation and User Acceptance of Information Technology in the

Banking Industry
Conference Paper · May 2019
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Ioannis Giatsidis Fotis Kitsios

University of Macedonia University of Macedonia
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Digital Transformation and User Acceptance of Information Technology in the Banking Industry,
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Patras, Greece, pp. 6-10. [see: http://eeee2019.teiwest.gr/docs/HELORS_2019_proceedings.pdf]
Digital Transformation and User Acceptance of Information

Technology in the Banking Industry
Ioannis Giatsidis Fotis Kitsios Maria Kamariotou

School of Information Sciences, School of Information Sciences, School of Information Sciences,
Department of Applied Informatics, Department of Applied Informatics, Department of Applied Informatics,
University of Macedonia University of Macedonia University of Macedonia
156 Egnatias st, 54636 Thessaloniki, 156 Egnatias st, 54636 Thessaloniki, 156 Egnatias st, 54636 Thessaloniki,
Greece Greece Greece
Abstract
During the last decades information and communication technologies (ICTs) in the banking sector have been increased.
The banking industry has spent a lot of money in order to use new technologies for the improvement of financial
services. Traditional business model of banks in the financial service industry have changed by the increasing
digitization. New players, either financial or non-financial companies have already entered into incumbent’s markets in
order offer more effective services with increased quality. Furthermore, customer relationships with banks and
employees workload have changed with the use of digital technology and impact on customer service performance.
Despite the fact that this field has attracted the interest of several scholars and practitioners, and the money that have
been spent to improve the quality of services in the banking sector through the use of ICTs are increased, the studies
that examine the digitalization of financial services are limited. Thus, the purpose of this paper is to synthesize and
analyze the findings of the existing literature review in order to answer the following question; how do digital
technologies shape the landscape of the financial service industry?. A conceptual framework is developed in order to
present the diverse aspects of IT enabled transformation in the financial service industry as well as their relationships.
KEYWORDS
Digital transformation; Information Technology; Internet banking; Adoption; User acceptance
1. INTRODUCTION
A contemporary phenomenon for the banking industry is the necessity to improve its infrastructure and
to be more digital. During the recession of 2008 and above, the banking industry make huge loss in
earnings. Despite the different views for the correlation of IT with profitability (Shu & Strassmann, 2005),
the majority of the researchers support that there is a positive correlation. Banking profitability is negative
due to the explosion of Non Performing Exposures. The solution to the problem for the industry was to be
digitally transformed (Worthington & Welch, 2011). Moreover, through digital technologies is much more
effective for banking industry to approach new clients (Cziesla, 2014).
In the existing literature there are a lot of reviews that they are trying to define digital transformation
(Vial, 2019). Digital transformation is “a process that aims to improve an entity by triggering significant
changes to its properties through combinations of information, computing, communication, and
connectivity technologies” (Vial, 2019). It includes a wide range of tasks, as digitalization of papers, e-
signature, e-learning, tele-conference, e-trading, e-statements, m-payments (Yip & Bocken, 2017).
Professionals in the banking industry make investments three-times more than any other industry in IT
(Gartner, 2012). The majority of the researchers have studied the acceptance of the digital transformation
with the customer view (Mishra & Singh, 2014). The main findings of these studies are that user acceptance
is the key issue for the acceptance of the new technology. The most common findings in these studies are
that perceived manageability, perceived usefulness, subjective norms, trustiness, attitudinal intentions
affect customer acceptance (Alsajjan & Dennis, 2010).
In contrast, there is not sufficient research from the view point of employees of the financial
organizations. According to the Hellenic Banking Association, during the last decade (2008-2018), 20.000
employees get retired or lose their jobs, and a number of 50.000 are still working at the Greek banking
industry. Thus, the purpose of this paper is to synthesize and analyze the findings of the existing literature
review in order to answer the following question; how do digital technologies shape the landscape of the
financial service industry?. A conceptual framework is developed in order to present the diverse aspects of
IT enabled transformation in the financial service industry as well as their relationships.
The paper is structured as follows. The next session describes the literature review methodology, and
presents the research framework session. The last session contains the conclusion and the final suggestions
for future research.
2. LITERATURE REVIEW METHODOLOGY

The literature review methodology was adopted by Webster and Watson (2002). In the first step of the
methodology a research of previous literature review studies was done. According to the subject of digital
transformation and the employee acceptance of information technology, nine literature reviews were used,
which describe the keywords that were used in searching articles as well as databases they searched into.
Scopus and Web of Science were the databases for the research. The keywords were the following:
“bank* or financ* and digital* or "Information Technology" and transform* or change or strategy*”, “effort
reward imbalance”, “bank* and transformation”, “financ* and transformation”, “bank* and information
technology”, “financ* and information technology”, “effort reward imbalance”, “bank* and change and
employee”, “new technologies and employee”, “change and management and bank”, “IT enabled
organizational transformation”, “IT enabled business transformation”. Articles were only in English. Papers
were published journals, conference proceedings and book chapters in the field of business management.
From the initial pool of 1.608 articles, only 31 fulfilled the above criteria. Figure 1 presents the article
selection process.
Figure 1 Article selection process
The final sample of 31 articles was classified to two categories according to their main subject. The first
one was the acceptance of digitalization either by customers or by employees, and the second one was the
employee behavior towards change management and organizational reform.
3. DIGITAL TRANSFORMATION AND ACCEPTANCE OF IT IN BANKING

Many researchers have focused on the transformation of financial sector and have studied the critical
success factors that affect the development of new services (Angelopoulos et al., 2008; Kitsios &
Kamariotou, 2019; 2017; 2016; Kitsios et al., 2008; Mitroulis & Kitsios, 2016). Branchless digital banking is
related with the implementation of digital means in the banking transactions without bank branches and
bank employees. Digital transformation seems to create a new era in banking. The implementation of
branchless banking has also effects in the workforce of the industry. Despite the huge investments in IT
infrastructure, there is no clear evidence about the increase of productivity in banking employees (Ho &
Mallick, 2010).
Perceived ease of use describes the level of understanding of the new branchless banking system by its
users. According to Hakim Suhaimi & Bin Abu Hassan, (2019) there is significant influence between this
variable and acceptance of digital banking. On the other hand, experience, has negative impact on
acceptance of digital banking (Venkatesh & Bala 2008). Apart from the perceive usefulness and perceive
ease of use (described in TAM model), there are also some other variables that should be taken into
consideration for acceptance of digital banking (Hakim Suhaimi & Bin Abu Hassan, 2019).
Perceived usefulness describes the level of the extent to which new technologies will empower the
client/user in the execution of a task. According to Hakim Suhaimi & Bin Abu Hassan, (2019) there is no
significant influence between perceived usefulness and acceptance of digital banking. In contrast Davis
(1993) indicated that perceived usefulness is 50% more crucial in contrast with perceived ease of use.
According to Venkatesh & Bala (2008) job relevance has a positive effect on perceived usefulness. On the
other hand, experience has a negative impact.
Perceived self-efficacy is the level of self-motivation for someone who has to complete successfully his
work. It is referred to the personal belief for someone who has to complete his own task. According to
Hakim Suhaimi & Bin Abu Hassan, (2019) there is no significant influence between perceived self-efficacy
and acceptance of digital banking.
4. METHODOLOGY
Based on the analysis of the existing literature review (Hakim Suhaimi & Bin Abu Hassan, 2019;
Venkatesh & Bala, 2008), the following hypotheses are defined in order to measure the relationship among
perceived usefulness, perceived ease of use, perceived self-efficacy, intention to use and usage behavior:
H1: There is no positive effect between perceived usefulness and intention to use digital banking.
H2: There is no positive effect between perceived ease of use and intention to use digital banking.
H3: There is no positive effect between perceived self-efficacy and intention to use digital banking.
H4: There is no positive effect between intention to use digital banking and usage behavior.
A questionnaire was developed for employees (professionals) in Greek banks in order to measure
perceived usefulness, perceived ease of use, perceived self-efficacy, intention to use and usage behavior.
The questionnaire was based on previous similar studies (Amin, 2012; Davis, 1993; Hakim Suhaimi & Bin
Abu Hassan, 2019; Legris et al., 2003; Venkatesh & Bala, 2008). 5 point likert scale ranging from “5=strongly
agree” to “1=strongly disagree” was employed. Figure 2 presents the conceptual model of the survey and
Table 1 presents the variables of the questionnaire.
Figure 2 Conceptual model and hypotheses
Table 1 Variables
Variables Questions References

Perceived usefulness Using applications/systems of digital banking (Amin, 2012; Davis, 1993; Hakim
improves the quality of the work I do Suhaimi & Bin Abu Hassan, 2019;
Using applications/systems of digital banking gives Legris et al., 2003; Venkatesh & Bala,
me greater control over my work 2008)
Applications/systems of digital banking enable me to
accomplish tasks more quickly
Applications/systems of digital banking support
critical aspects of my job
Using applications/systems of digital banking

increases my productivity
increases my job performance
Using applications/systems of digital banking allows
me to accomplish more work than would otherwise
be possible
enhances my effectiveness on the job
Using applications/systems of digital banking makes it
easier to do my job
Overall, I find applications/systems of digital banking
useful in my job
Perceived ease of use I find applications/systems of digital banking (Amin, 2012; Davis, 1993; Hakim
cumbersome to use Suhaimi & Bin Abu Hassan, 2019;
Learning to operate applications/systems of digital Legris et al., 2003; Venkatesh & Bala,
banking is easy for me 2008)
Interacting with the applications/systems of digital
banking is often frustrating
I find it easy to get the applications/systems of digital
banking to do what I want to do
Applications/systems of digital banking are rigid and
inflexible to interact with
It is easy for me to remember how to perform tasks
using applications/systems of digital banking
Interacting with applications/systems of digital
banking requires a lot of mental effort
My interaction with applications/systems of digital
banking is clear and understable
I find it takes a lot of effort to become skilful at using
applications/systems of digital banking
Overall, I find applications/systems of digital banking
easy to use
Perceived self- I could complete the job using applications of digital (Amin, 2012; Venkatesh & Bala,
efficacy banking… 2008)
…if there was no one around to tell me what to do as
I go
… if I had just the built-in help facility for assistance
…if someone showed me how to do it first
…if I had used similar applications before this one to
do the same job.
Intention to use Assuming I had access to applications of digital (Hakim Suhaimi & Bin Abu Hassan,
banking I intend to use them 2019; Legris et al., 2003; Venkatesh
Given that I had access to applications of digital & Bala, 2008)
banking, I predict that I would use them
I plan to use applications of digital banking in the next
<n> months
Usage behavior On average, how much time do you spend on (Amin, 2012; Hakim Suhaimi & Bin
applications/systems of digital bankingeach day? Abu Hassan, 2019; Legris et al.,
2003; Venkatesh & Bala, 2008)
5. CONCLUSIONS
The majority of the existent survey is referred to the level of acceptance of digital transformation and
new digital technologies only by the customers of banking firms. The purpose of the research is to fulfill this
gap in the academic research, and to provide information about bank employees’ perspective and
intentions towards digitalization.
Administrative executives and HR departments could make use of these findings in order to control and
manipulate the negative consequences of this kind of change and to cultivate and empower the positive
effects of digitalization in banking industry. Training programs could be used in order to provide to the users
all the necessary knowledge for the harmless transformation to the digital era. Taking into consideration
that the effort of the financial institution to establish branchless banking will be intensive (Kadlag, 2012), a
continuous interest for research on acceptance of digital transformation in the banking industry will exist
the following years. Managers and practitioners could also make use of the findings to imply more
employee friendly tactics in order to facilitate the transition of conventional banking to branchless banking
era.
REFERENCES
Amin, H., Supinah, R., Aris, M. M., & Baba, R., 2012. Receptiveness of mobile banking by Malaysian local customers in
Sabah: an empirical investigation, Journal of internet banking and commerce, Vol. 17, No. 1, pp. 1-13.
Angelopoulos, S., Kitsios, F., & Babulac, E., 2008. From e to u: Towards an innovative digital era, In: Kotsopoulos, S., &
Ioannou, K. (Eds.), Heterogeneous Next Generation Networking: Innovations and Platform, IGI Global Publishing, pp.
427-444.
Alsajjan, B., Dennis, C., 2010. Internet banking acceptance model: Cross-market examination, Journal of Business
Research, Vol. 63, No. 9–10, pp. 957–963.
Cziesla, T., 2014. A literature review on digital transformation in the financial service industry. Proceedings of the 27th
Bled eConference: eEcosystems. Bled, Slovenia, pp. 18-31.
Davis, F. D., 1993. User acceptance of information technology: system characteristics, user perceptions and behavioral
impacts, International journal of man-machine studies, Vol. 38, No. 3, pp. 475-487.
Hakim Suhaimi, A. I., & Bin Abu Hassan, M. S., 2019. Determinants of Branchless Digital Banking Acceptance Among
Generation Y in Malaysia. Proceedings of the 2018 IEEE Conference on E-Learning, e-Management and e-Services
(IC3e), Langkawi, Malaysia, pp. 103–108.
Ho, S. J., & Mallick, S. K., 2010. The impact of information technology on the banking industry, Journal of the
Operational Research Society, Vol. 61, No. 2, pp. 211–221.
Kadlag, S., 2012. Varying Impacts of Electronic Banking on the Banking Industry, Journal of Information Technology &
Software Engineering, Vol. 02, No. 03, pp. 2–4.
Kitsios, F., & Kamariotou, M., 2019. Mapping New Service Development: A Review and Synthesis of Literature, The
Service Industries Journal. doi: 10.1080/02642069.2018.1561876 (in press).
Kitsios, F., & Kamariotou, M., 2017. Strategic Change Management in Public Sector Transformation: The Case of Middle
Manager Leadership in Greece. Proceedings of British Academy of Management (ΒΑΜ) Conference 2017, Coventry,
UK, pp. 1-17.
Kitsios, F., & Kamariotou, M., 2016. The impact of Information Technology and the alignment between business and
service innovation strategy on service innovation performance. Proceedings of the 3rd IEEE International Conference
on Industrial Engineering, Management Science and Applications (ICIMSA 2016), Jeju Island, Korea, pp. 247-251.
Kitsios, F., Angelopoulos, S., & Zannetopoulos, I., 2008. Innovation and e-government: an in depth overview on e-
services, In: Kotsopoulos, S., & Ioannou, K. (Eds.), Heterogeneous Next Generation Networking: Innovations and
Platform, IGI Global Publishing, pp. 415-426.
Mitroulis, D., & Kitsios, F., 2016. Fostering a Competitive Differentiation Strategy for Sustainable Organizational
Performance, In: Grigoroudis, E. & Doumpos, M. (Eds.), Operational Research in Business and Economics, Springer
Proceedings in Business and Economics, pp. 85-112
Legris, P., Ingham, J., & Collerette, P., 2003. Why do people use information technology? A critical review of the
technology acceptance model, Information & management, Vol. 40, No. 3, pp. 191-204.
Mishra, V., & Singh, V., 2014. Analyzing the gap in the adoption of Internet Banking Services: Managers’ perspective.
Proceedings of the 2nd International Conference on Business and Information Management (ICBIM 2014), Durgapur,
pp. 42–46.
Shu, W., & Strassmann, P. A., 2005. Does information technology provide banks with profit?, Information and
Management, Vol. 42, No. 5, pp. 781–787.
Suhaimi, A. I. H., & Hassan, M. S. B. A., 2018. Determinants of Branchless Digital Banking Acceptance Among Generation
Y in Malaysia. Proceedings of the 2018 IEEE Conference on e-Learning, e-Management and e-Services (IC3e),
Langkawi, Malaysia, pp. 103-108.
Venkatesh, V., & Bala, H., 2008. Technology acceptance model 3 and a research agenda on interventions. Decision
sciences, Vol. 39, No. 2, pp. 273-315.
Vial, G., 2019. Understanding digital transformation : A review and a research agenda, Journal of Strategic Information
Systems(in press) doi:10.1016/j.jsis.2019.01.003
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Production, Vol. 174, pp. 150-169.
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Ioannis Giatsidis Fotis Kitsios

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Digital Transformation and User Acceptance of Information

Ioannis Giatsidis Fotis Kitsios Maria Kamariotou

2. LITERATURE REVIEW METHODOLOGY

3. DIGITAL TRANSFORMATION AND ACCEPTANCE OF IT IN BANKING

Figure 2 Conceptual model and hypotheses

Variables Questions References

Using applications/systems of digital banking

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