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Abstract
Around half of the world's population is out of formal banking and financial services. On the other hand, in the last few years tremendous growth has been observed in mobile penetration in many countries across the world and specifically in a number of developing countries. With an aim to expand financial inclusion through mobile banking, using innovation diffusion theory and decomposed theory of planned behavior together, this study added a variable, namely perceived financial cost to the combined model to identify and examine factors influencing behavioral intention to adopt (or continue to use) of mobile banking in Bangladesh. The results of Structural equation modeling (SEM) indicate that Perceived financial cost, Perceived risk and Subjective norm are the most influencing factors that affect people's behavioral intention to adopt (or continue to use) mobile banking. Findings of this study have greater significance for the mobile banking service providers and policy makers of Bangladesh to design mobile banking services in such a way so that access and usage of this service can be increased which ultimately will have a positive impact on the country's financial inclusion campaign.
JEL Classifications: G21, G28, O33
Keywords: Mobile banking, Bank led financial inclusion, Diffusion of Innovation theory (DOI),Technology Acceptance model (TAM), Theory of planned behavior (TPB), Attitude, Behavioral Intention.
1 Introduction
1.1 Background
Financial inclusion has emerged as a hot issue to the researchers, academicians and governments of both developed and developing countries since 2005, a year that the UN has declared International Microcredit Year. From a broader perspective, financial inclusion denotes delivery of formal financial services at an affordable cost to each and every member of a country. In Bangladesh, during last few years, the banking industry has experienced tremendous growth. However, there are concerns that banks have not been able, due to high operating costs, to include vast section of entire population into the fold of basic banking services, especially peoples from remote and rural areas. Distance or time to bank branch can increase the effective cost of using financial services, as a result the supply curve of financial services shifts upwards, out of reach if individuals with modest demand. From a supply side perspective, higher levels of financial inclusion can be achieved if bank networks expand...