Assessing Factors Influencing the Diffusion of Mobile Banking in South Africa - A case study on the company Wizzit

Abstract: There are about 6.5 billion people living on earth. Only about 1.5 billion have a bank account but as many as 4 billion people have access to a mobile phone. In South Africa research indicates that about 16 million of 48 million inhabitants do not have a bank account but as many as 90% of the population have access to a mobile phone. During 2005 an initiative to give access to bank services through mobile phones was launched by the company Wizzit. Wizzit has since then offered thousands of people better living standards through its mobile banking services but the adoption rate of their service has been relatively low and Wizzit has not yet reached breakeven. A grant from the Swedish International Development and co-operation Agency (Sida) enabled a field study in South Africa. The questions the authors wanted answers to after this study was completed were: “What are the main factors influencing the diffusion of Wizzit’s banking service in South Africa and how do these factors influence the rate of diffusion?” “What are the main obstacles that have to be overcome from Wizzit’s side in order to speed up diffusion?” 21 semi-structured interviews and a number of observations were conducted in South Africa with different actors in order to collect the information that would enable the authors to answer these questions. These actors were either involved in Wizzit directly or in mobile banking in general. In addition to this, before and after the field study was conducted a number of interviews were conducted in Sweden with experts in the field. The findings from these different interviews lay the foundation for the authors’ conclusions. Our empirical findings correspond well to theory in that they indicate that the main factors influencing diffusion are innovation features, social factors, customer perception of the innovation and how well adjusted to a developing country environment the offer is. Further on, our conclusions indicate that the main obstacle to overcome in order to speed up diffusion is to build trust in the service among existing customers and among potential adopters.