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CHAPTER ONE INTRODUCTION 1.1       Background to the Study

Mobile applications adoption rate has been growing at high rates as a result of expanding access by and understanding of smart phones by young and old generations.Mobile money is a technology-infused means of financial transactions, payment for a wide range of goods, products and service across the globe using the mobile phone at the comfort of one’s room. The need for individuals, businesses, institutions, organisations and service providers to get their customers informed and in tune with the current realities is imminent in a bid to meet up with internationally accepted standards of business and transactions, achieve “financial inclusion” which is seen as an impediment to the economic development of some countries necessitated the need to develop or adopt mobile money or payment, even in the eye of low literacy level which is an indication that technologies is still very far to some people and places, region and demographics, and in fact, remains a nightmare to many more.

The need for business and service providers, especially financial institutions to take the giant stride of getting their esteemed costumers and services users entrenched into applicable technologies in consonance with the evolving cashless policy cannot be over-emphasised. Bearing in mind the projection of the Federal government of Nigeria with the Nigeria Payments System Vision 2020: “To facilitate economic activities by providing safe and efficient mechanisms for making and receiving payments with minimum risk to the central bank, payment by service providers and end users, extending the availability and usage to all sectors and geographies, banked and unbanked, and conforming to internationally accepted regulatory, technical and operational standards” (Central Bank of Nigeria, 2013), financial institutions must brace up to make the success of the policy a reality.

As noted by Faniran and Odumeru (2015), in the year 2012, the Federal Government of Nigeria through the regulatory financial institution: The Central Bank of Nigeria (CBN) introduced what it called the cashless policy to drive the country’s development and modernisation of its payment system. It was further revealed that the rationale behind the policy is to help Nigeria in its vision 2020 goal of making the country one of the 20 biggest economies by the year 2020. Other reasons for this policy is to reduce the cost of banking services (including cost of credit) and drive financial inclusion by providing more efficient transaction options and greater reach and to improve the effectiveness of monetary policy in managing inflation and driving economic growth. By implication, customers and users of goods, products and services are as much as possible expected to deal less, if totally not with cash in their various business transactions.

It should be noted that new terrain and development in the payment system for goods, products and services cuts across all sectors of the Nigerian economy: Agricultural, Education, Banking, Telecommunication, Health, Oil and Gas, Maritime, Aviation etc., as projected by the Federal Government of Nigeria through the Apex bank, and it is the responsibility of all the stakeholders in the banking industry transacting one business or the other in the private and public sectors to make the technological development and advancement a success. However, the successful diffusion of the innovation which can be said to be a right step in the right direction may not be devoid of itches and challenges of various degrees.

Bello (2010) stated that Nigerian Mobile Telecom market is indeed the fastest growing market in Africa, maintaining its lead with active subscribers of about 78 million (NCC, March 2010) and relegating South Africa to second place with about 45 million subscribers. Nigerian telecoms came into mainstream in 2001 when the deregulation of the subsector of the economy gave way to private involvement. The telecommunication system was opened up with the issuance of Global System for Mobile communication (GSM) unified license in 2001. GSM license in Nigeria cost about US$285million. The world is fast becoming a global village and a necessary tool for this process is communication of which telecommunication is a key player. The quantum development in the telecommunications industry all over the world is very rapid as one innovation replaces another in a matter of weeks. A major breakthrough is the wireless telephone system which comes in either fixed wireless telephone lines or the Global System of Mobile Communications (Ijewere and Gbandi, 2012).

As posited by Showole and Ibrahim (2014), mobile phone or handset as a dominant means of communicating in the telecommunication sector started in the earlier 20th century in developed continents before moving to the developing ones in 21st century. Africa nations, most importantly Nigeria experienced her first mobile phone communication in the mid of 2001 when the then President OlusegunObasanjo approved various independent telecommunications industries as mobile phone service providers. The move made by the administration of the former president, literarily ended the monopoly enjoyed by the government owned NITEL, and rooms were provided for stakeholders in the private sector to operate in the telecommunications industry.

Showole and Ibrahim (2014) further stressed that the emergence of mobile phone in Nigeria has helped in advancing various causes in the areas of health, business, financial and other social services to the generality of the citizenry. The device has assisted medical practitioners and concerned authorities in the nation’s health sector to spread health-related issues messages through SMS to the citizenry, expanding business conversations, allowing citizenry to have banking and other business transactions without necessarily being at the banking hall, business or service providers outlets (mobile money services or mobile money) and at the same time helpful in curbing varied social vices such as armed robbery.

Bello (2010) further posited that NITEL was the only operator in the market before 2001 with subscribers of about 500,000 from a population of about 140 million. The deregulation ushered in telecom players like MTN, Glo Mobile, the former Econet now called Airtel, Etisalat, Visafone, Multilinks, Starcomm and Zoom formerly Reltel. It was further stressed that the telecom regulator in Nigeria is Nigerian Telecommunication Commission (NCC), with reference to NCC Act 2003; 3-(1) “There is established of a commission to be known as Nigerian Telecommunications Commission with responsibility for the regulation of the telecommunication sector in Nigeria”. Among these telecommunications service providers, MTN, Glo, Etisalat and Airtel are the major competitors.

According to Statista (2017), the number of mobile phone users in the world is expected to pass the five billion mark by 2019. In 2016, an estimated 62.9 percent of the population worldwide already owned a mobile phone. However, for the year 2017, the number of mobile phone users is forecast to reach 4.77 billion. Relatedly, Adeleke (2016) reported that the Nigerian Communications Commission (NCC) has revealed that the number of connected telephone lines in Nigeria rose to 216 million between January and March. This implies that a good number of Nigerians are telecommunication service network subscribers, though many with multiple lines.

However, it was reported that there are over 97 million bank accounts, but just like active lines aren’t equal to unique users in telco parlance, the number of unique bank account holders is a fraction of that number. Going by the number of BVNs, the number of accounts per Nigerian bank account owner is three. Actually, it’s the same reason why Nigerians have more than one mobile line (Bankole, 2017). Be it as it may, there is no bank account that does not have a phone number linked to it for receiving transaction information such as bank alert, wishes and mini bank statements from banks. This makes it imperative that if banks can communicate with account owners via their phone numbers, using that same phone number by customers for bank transaction without having to visit the bank is an essential possibility which mobile money can achieve.

Oduh and Ogechi (2012) revealed that notwithstanding the far-reaching contribution of the mobile telecommunications sub-sector in Nigeria’s socioeconomic development, Nigeria is among the countries with the poorest readiness and usage of telecommunications among key economic agents. Faniran and Odumeru (2015) opined that the introduction of Global Systems for Mobile Communication (GSM) in 2003 has changed the face of mobile communication all over the World. Virtually every aspect on human interaction is being affected by the use of mobile phones.  The use of mobile money does not require internet connection rather the service of telecommunication service providers.

The rapid development in the mobile-cellular subscription and use of the internet rate across the globe and especially in the developing countries is indeed remarkable. The mobile phone with its array of features has the capacity to transpose the world into a global market in which buying and selling can be made possible.

As posited by Alabi (2006), while the existence of information does not necessarily ensure its use, the real value of an information system lies in the servicing of specific user needs, also bearing in mind of the user’s ability.  By implication, this means that getting the Nigerian populace informed of the technological improvement in the telecommunications sector, gear toward socio-economic development is not enough, taking steps further and ensuring their conformity,  and its acceptance which is subject to numerous factors is the crux of the matter.

Mobile money is a technological transaction phenomenon which has thrived in world well-populated economies in the Asian and European countries. Nigeria, as the most populous African nation among others cannot with over 150million subscribers of telecommunication service operators and mobile phones users afford to lag behind while technological advancement and development radiates over her counterparts in the developed world. As noted by Johnson (2016), to transactions business without restriction of time and space has become an easy task as making cash transaction with mobile phones is now very easy with banks Unstructured Supplementary Service Data (USSD) code to perform simple tasks in a more convenient, secure way without having to visit the bank or spending long hours queuing on Automated Teller Machine (ATM). Transactions such as money transfer, pay bills, recharge cards, change card pin, read mini bank statement, and make payment for purchases among others.

According to Odia (2012), mobile money has never been more valued in any economy than it is today. It was predicted by Deloitte (one or more of Deloitte Touche Tohmatsu Limited) that by end-2015, five percent of the base of 600-650 million near-field communication (NFC) equipped phones will be used at least once a month to make contactless in-store payments at retail outlets. The prediction was said to be in comparison with monthly usage by less than 0.5 percent of the 450-500 million NFC-phone owners as of mid-2014. Contactless mobile money will not be mainstreamed by end-2015, but niche adoption will be a major progression from near nil in prior years.(Technology, Media and Telecommunications, 2016).

It was further said by TMT (2016) that while usage of phones to make contactless payments is expected to increase over time, they are likely to co-exist for some time with all other means of payment, from contactless credit cards to cash. It will be a long while before the majority of us can jettison our physical wallets.For many years, has smartphones been used to effect financial operations, such as checking balances, transferring funds, and transacting online and payment for products, goods and services without physical transactions, contacts or interactions.

From the foregoing, it should be noted that for success in technology, system upgrade, analysis and evaluation, the user is the most important stakeholder to be considered as their acceptance and use of the innovation is directly proportional to its successful diffusion. A well designed and structured system or technology is of zero value if it is rejected by its expected users. Davis (1999) opined that the lack of acceptance as long been an impediment to the success of new information systems. It was further stressed that users acceptance is seen as a pivotal factor determining the success of failure of an information system project. This implies that every organisation or designer of technology and information system must deeply take into consideration the person and personality, ability and status of the end users.

As much as possible, the designed technology should have user-oriented features. With the relatively high level of importance attached to the user for the success of technologies and systems, it is expedient to know in clear terms who a user is. A user can be opined as an individual, person, people, institution or organisation who approaches a given technologies or information system(s) with a particular (information) need(s) with the full expectation of getting the needs met with optimum satisfaction. If such a user is therefore not satisfied with the services of the technology or system, such system or technology may be said to be ineffective or inefficient, or that there are some user-related factors hindering his/her ability to maximally explore the technology or information systems.

As explained by Sheriff (2016), USSD codes also known as quick codes are set of codes used by mobile phone users to communicate with a particular service provider’s computer.  It was submitted that the use of USSD codes started with Telecommunication service providers who provides the codes for easy recharge and other service, but later it had been adopted by other service providers, notably the banks. It was further stated that banks had adopted the use of these codes to easy banking and reduce workload from their end while rendering better, safer and faster services to the customers.

In the same vein, Ojobojo (2016) submitted that as technology evolves, the financial sector is not left behind as several softwares have been developed to make banking easier and faster. One of such is the USSD code for mobile phones, USSD means Unstructured Supplementary Service Data; a service which allows you pay your bills and do other transactions by simply dialing a short code on your phone, USSD codes are also called Quick Codes. Almost all banks in Nigeria now have their special USSD codes for mobile money transactions such as: Buying airtime, Account Opening, Balance Inquiry/Checking, Money transfer to same bank and other banks, Cash-on-the-go, etc.The service is similar to internet banking except that it does not use internet access so when a person does not have access to the internet, he/she can still use USSD codes for banking transactions.

It should be noted that putting USSD codes to use for mobile money requires a given user to acquire any telecommunication service provider SIM card or mobile line, register or link the phone number with bank account(s) to enable USSD transactions. Also, all USSD transactions require a PIN code which serves as security against fraudsters and scams. A user is required to set the PIN code(either 4 or 5 digits) the first time of doing a USSD transaction. Expressly, USSD code mobile money transfer service is fast, secure and convenient (Ojobojo, 2016).

Some banks USSD codes for mobile money are GTBank USSD code- *737#, Fidelity Bank USSD code- *770#, First Bank USSD code- *894#, Wema Bank USSD code- *945#,  Skye Bank USSD mobile code- 833#, Sterling Bank USSD mobile banking code- *822#, Diamond Bank USSD code- *710#, Ecobank Mobile USSD code is *326#, Zenith Bank USSD code-*966#, FCMB USSD code- *389*214#, Unity Bank USSD mobile code- *389*215#, UBA’s mobile USSD code-*919#, Union Bank USSD transfer code- *389*032#, Heritage Bank  USSD code-*322*030#, Keystone Bank USSD code- *322*082#, Access Bank USSD code- *901# and Stanbic IBTC USSD code- *909# among others. Guaranty Trust Bank is the leading bank in Nigeria in terms of electronic banking. They were one of the first to introduce USSD banking (Ojobojo, 2016).

The interoperability of the banking and telecommunications sectors is brought to fore. The telecommunication network service providers took the lead in USSD use, and after which they provided banks with network service and create codes which can be used to offer mobile money services to each bank’s customers. Mobile money being a fairly new innovation in Nigeria is sparsely explored by bank customers. It is expedient to state that the need to bring this financial technological innovation closer and accessible to customers and improve their banking experience cannot be over-emphasised.

A study by Omolade and Opesade (2017) submitted that university students in Oyo State are prolific users of mobile and smartphones application for educative, social, business and entertainment purposes. The study revealed that Google Play was the most used mobile app store, while Facebook was the most used app among the students. Students use mobile applications frequently and virtually every day despite their busy academic schedules, and they mostly use them for social networking, education and news. It can be inferred that that youth, especially students of institutions of higher learning are avid users of technological applications via their mobile with banking, selling and buying, and transaction applications and systems such as mobile payment not an exception. Mobile money is a technological and innovative option of financial transactions through mobile phone at the comfort of one’s room with ease.

There is a need to investigate the factors that can influence or affect consumer’s acceptance of mobile money payment option, one of the numerous mobile applications available to technology users, provided by commercial banks to their customers. To this end, in view of the significance of mobile money, this research aims to provide knowledge based on mobile money while analysing and appraising factors which affects the acceptance of mobile money option for transactions by students of the University of Ibadan, Nigeria.

1.2       Statement of the Problem

Mobile money may be fast and easy, but there has been a consistent complain of incomplete transactions in many cases.  This causes of these issues has not been pointed out yet, although banks tend to initiate a reversal on such irregular transactions. Students however, do not seem to appreciate this because of the sources of their academic funds and the level of tasking school activities they have to go through before clearing a particular transaction dispute.  Hence this study will study the factors responsible for the easy acceptance of mobile money.

1.3       Objectives of the Study

The main objective of this study is to identify the factors that affect mobile money acceptance among students of University of Ibadan. However, the specific objectives are to:

1.    Determine the frequency of use of mobile money by students of University of Ibadan.

2.    Identify the risks and benefit associated with mobile money use among students of University of Ibadan.

3.    Find out the factors for and against the use of mobile money by students of University of Ibadan.

4.    Assess the influence of perceived behavioural control on mobile money use among students of University of Ibadan.

5.    Analyse the subjective norm and its influence on mobile money use among students of University of Ibadan.

1.4       Research Questions

The following research questions will be considered to guide this researcher:

1.    How often do students of University of Ibadan use of mobile money?

2.    What are the risks and benefit associated with mobile money use among students of University of Ibadan?

3.    What are the factors for and against the use of mobile money by students of University of Ibadan?

4.    What is the influence of perceived behavioural control on mobile money use among students of University of Ibadan?

5.    What  subjective norm and its influence on mobile money use among students of University of Ibadan.

1.5       Justification of the Study

The need to provide a safe, better, faster and easier banking services and offer customers a memorable banking experience is imminent as trading, business transactions and patronage on goods, products and services has evolved. This study will contribute to the body of knowledge by substantiating determinants of successful diffusion of innovation and the acceptance of mobile money innovation by bank customers. The outcome of this study will create more awareness about mobile money, its importance and benefits for users and the banking system in pursuance of the 2020 cashless policy. Of immense importance will this study be at evaluating the factors which influence or affect customers’ acceptance and intention to use mobile money in financial transactions.

The outcome of this study will help banks to assess their mobile money service delivery and work on improvement and design of a user-oriented mobile money system for a better, easier and safer banking experience. This study’s outcome will serve as a measure of the level of achievement of cashless policy by the Federal government of Nigeria, and help the Central Bank of Nigeria evaluate the cashless policy, assess the level of adoption by Nigerian to ensure the 2020 cashless future vision in conformity with world standards.

1.6       Scope and Limitation of the Study

The scope of this study will be focused on the factors affecting the acceptance of mobile money payment option provided by banks to their customers. The study will give a description of users’ attitudes and perceptions about mobile money. The study will be limited to students of the University of Ibadan due to financial and time constraints. The study will focus on 28,679 students

1.7       Operational Definition of TermsBanks: These are financial institutions involved in keeping and safeguarding customers’ money and carrying out other financial and business related activities.

Customers: These are persons, people, individuals, institutions and organisations who engage in one financial transaction or the other with other people, institutions or establishments.

Mobile Money: This is a more recent payment system in which transactions on goods, products and services are made right on, and through the mobile phone without having neither internet connection nor being physically present at the business centre or place. It is a transaction mode made possible through the use of Unstructured Supplementary Service Data codes.

Mobile Phone: This is otherwise known as cell phone. It is a hand-held device used for mobile communication between many people over a long distance. It has different uses for different people, but sending and receiving calls, text messages and taking pictures or video are the most popular activities among mobile owners.

Unstructured Supplementary Service Data: These are at of codes specifically designed for each banks or any other establishment in making cash transactions for payment for goods, products and services without physical presence at the business location.

User Acceptance: Acceptance and use of an innovation by individuals or organisations who are members of a social system with the aim of deriving satisfaction.