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Electronic Payment Systems: Issues of User Acceptance

Dennis ABRAZHEVICH SamenwerkingsOrgaan Brabantse Universiteiten

(SOBU), Technical University of Eindhoven (TUE)

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INTRODUCTION

• Use of technology have led to emergence of various new supporting services in marketplace

• Electronic payment is an essential part of e-commerce and e-business

• Rapid development of the World Wide Web and the Internet technology has changed the landscape of the operation of retail businesses

• E-payment system have received different acceptance level throughout the world

• Through B2C e-commerce retailers can promote their products through the Internet and reach potential customers around the world with minimal cost.

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CHALLENGES

• The level of adoption of E-commerce by customers is a key factor affecting the success or failure of e-Businesses.

• One key factor affecting the user adoption on B2C E-commerce is trust.

• Existing payment systems such as- credit cards are widely accepted as a means of payment on the Internet. However, users don’t see in them enough of reliability, trust, security etc.

• There requires a need for heavy initial investment for the payment system gateway

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OBJECTIVES

• Analyze the factor affecting the e-payment system

• Identify challenges associated with e-payment system

• To understand the impact of e-payment system on the economy

• To identify the option for future expandability

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METHODOLOGY

• The survey was conducted in the form of self-administered questionnaire sent out by post.

• Conducted an online survey with the help of the Octopus system provider. All questions in the survey were measured on a 7-point Likert scale.

• An online video demonstrating the process was shown to survey respondents to help them understanding this possibility and answering the related questions

• Among the 1328 of the respondents 94.1% are users of electronic payment systems, the respondents are daily users of conventional and electronic payment systems, 19.4% have made payments on the Internet.

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LITERATURE REVIEW

“A Risk Perception Analysis on the use of Electronic Payment Systems by Young Adult “, Noor Raihan Ab Hamid & Aw Yoke Cheng, Malaysia, 2013 Identify young adult’s perception of e -payment risk and their behavior towards different payment methods.

• findings showed significant difference in perceived risk between cash and E-Payment but less significant in terms of volume of purchase

“E-Payment: powering West Africa”, Mark O’Flynn, sales director, Middle East & Africa, VeriFone EMEA, investigates

• e-Payment viewed as part of a reform agenda that aims to transform the region into an emerging market that is highly attractive to global investors

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“Survey of Customers’ Conceptions of Security and Trust in E-Payment System”, Fakhraddin Maroofi, Reza Hashemi and Zohre Nargesi, Iran, 2012•examine issues related to e-payment security from the viewpoint of customers •Consumers’ observed security is positively related to consumers’ observed trust and EPS use

“An exploratory study on the impact of trust on different e-payment gateways: Octopus card vs. Credit card , Kevin K.W. Ho, School of Business and Public Administration, University of Guam Hong Kong, 2011•Impact of trust on two different E-payment gateways• empirical result shows that consumers in Hong Kong are using di- efferent trust building processes to consider their adoption for E-payment gateways

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Users Trust on E-payment gateways

PU positively affects AI of a B2C E-commerce payment gateway.

PEOU positively affects AI of a B2C E-commerce payment gateway.

Trust positively affects AI of a B2C E-commerce payment gateway.

Familiarity with a trustworthy B2C E-commerce payment gateway positively affects the trust in that payment gateway.

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Issues Of User Acceptance

The users acceptance of electronic payment system depends on:•Anonymity•Efficiency•Ease of use•Convertibility of fund•Security•Trust

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• Focus on user requirement for concrete applications in the targeted context of use and receive feedback from potential users,.

• Ensure that characteristics in the payment system is along with the requirement and predictions ensuring high level of acceptance.

Guidelines For Businesses

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CONCLUSIONElectronic payment is playing a key role in helping to boost

financial transactions.One of the technological innovations in banking, finance and

commerce is the Electronic Payments.On the basis of present study, first remark is that despite

the existence of variety of electronic payment systems, credit cards are the most dominant payment system

success of e-commerce payment systems also depends on consumer preferences, ease of use, cost, industry agreement, authorization, security, authentication, non-refutability, accessibility and reliability and anonymity and public policy

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.

Technical contribution and security declaration are significant factors for improving consumers’ observed security.

Consumers’ observed security is positively related to consumers’ observed trust and EPS use

e-payment service providers may have to provide consumers with not only secure procedure but also convenient procedures for e-payment systems

Need to develop guidelines and principles for design of effective interactions between humans and payment systems to arrive at user-accepted electronic payment systems