Factors Influencing the Adoption of Digital Banks Among Generation Z in Indonesia: Based on Extended Unified Theory of Acceptance and Use of Technology (UTAUT2)

Abstract

In the past several years the digital bank has started to disrupt the banking landscape in Indonesia, aiming for the younger generation, the advancement of technology and the shifting habit in using banking services among the customers has driven banks in Indonesia to provide digital banking service. Many digital banks are still trying to implement strategies and combinations to provide a well-adopted product while some result in the decline in adoption number from year to year. Therefore, this study aims to investigate the factors influencing Generation Z preference in adopting digital banks in Indonesia to give digital banks in Indonesia a better understanding. This research uses UTAUT2 since it is suitable to clarify the technology acceptance from the customer perspective. The data is gathered from 400 digital bank users among Generation Z in Indonesia and analyzed using Partial Least Square – Structural Equation Modelling (PLS-SEM). The result showed that behavioral intention, habit and facilitating conditions significantly affect the use behavior while performance expectancy, trust and habit significantly affect the behavioral intention among generation Z in using digital bank.

Keywords: Customer adoption, digital bank, generation Z, Extended Unified Theory of Acceptance and Use of Technology, Indonesia